THE  LIBRARY 

OF 

THE  UNIVERSITY 
OF  CALIFORNIA 

LOS  ANGELES 


HANDLING  MEN 


SELECTING  AND  HIRING 


HOLD    YOUR 


BREAKING  IN  AND  DEVELOPING  MEN 


PUTTING  MORE  THAN  MONEY 


IN  PAY  ENVELOPES 


A.  W.  SHAW  COMPANY 

CHICAGO  NEW  YORK 

LONDON 


Copyright,  1917,  by 
W.  SHAW  COMPANY 

PRINTED  IN  U.  8.  A. 


Bus.  Ad*iin. 
Lib. 


CONTENTS 


I— SELECTING  AND  HIRING 

Editorial  by  John  Wanamaker     ........  7 

I    How  WE  LIFTED  HIRING  OUT  OF  THE  Bur     .        .  9 

By  A.  K.  Baer, 
Secretary-Treasurer,  Strouse-Baer  Co. 

II    LIVING  UP  TO  Yotra  EMPLOYMENT  SYSTEM       .        .         13 

By  Carroll  D.  Murphy 
Based  on  an  extensive  investigation 

HI    WHEN  YOUR  MEN  HELP  You  HIRE    ....         24 

By  Charles  Harris 
Based  on  an  extensive  investigation 

IV    THE  MAN  FOR  THE  JOB 31 

By  Carroll  D.  Murphy 

Based  on  an  extensive  investigation 

V    WHY  WE  ARE  REPLACING  MEN  WITH  WOMEN        .         47 

An  Interview  with  Will  I.  Ommer, 
President,  Recording  and  Computing 
Machines  Company 


II— HOW  TO  HOLD  YOUR  MEN 

Editorial  by  Frank  Disston 57 

VI    THE  KNACK  OF  HOLDING  YOUB  MEN       ...         59 

By  Henry  L.  Willard, 
President  of  the  Brooklyn  Traffic  Club 

VII    How  WE  HOLD  OUR  MEN 67 

By  Frank  Disston, 

President  of  Henry  Disston  &  Sons,  Incorporated 

VIII    THERE'S  A  SOLUTION  FOR  LABOR  TROUBLES      .        .         82 

An  Interview  with  John  D.  Rockefeller,  Jr. 
By  Samuel  Crowther 

IX    THE  HIGH  COST  OF  LABOR  THAT  COMES  AND  GOES     .         91 

By  Leon  I.  Thomas 
Based  on  an  extensive  investigation 

X    KEEP  IN  TOUCH  WITH  JOHN  AND  JIM       .       .        .       103 

The  Views  of  63  Executives,  with  an  Introduction  by  William  Cordes, 
General  Manager  of  the  Florence  Manufacturing  Company 


1260767 


CONTENTS 


III— BREAKING  IN  AND  DEVELOPING  MEN 

Editorial  by  Edward  B.  Butler  119 

XI    FITTING  INSTEAD  OF  FIRING  MEN     .        .  121 

By  W.  S.  Ball 

Based  on  an  extensive  investigation 

XII     "GROWING"  YOUR  OWN  EXECUTIVES         .        -        .        127 
By  Harry  Franklin  Porter, 
Organization  Engineer 

XIII  THE  BUILDING  OF  MEN 138 

An  Interview  with  Edward  B.  Butler, 

Chairman  of  the  Board  of  Directors  of  Butler  Brothers 
By  Carroll  D.  Murphy 

XIV  SHAPING  MEN  TO  THE  WORK 143 

By  C.  H.  Slocum, 

President  of  the  St.  Paul  Book  &  Stationery  Company 

IV— PUTTING  MORE  THAN  MONEY  IN 
PAY  ENVELOPES 

Sditorial  by  James  A.  Farrell  151 

XV  PROFIT  SHARING — ITS  SUCCESS  AND  FAILURES      .        .        153 

By  Boyd  Fisher, 
Vice-president  of  the  Executives'  Club  of  Detroit 

XVI     PROFIT  SHARING:  WHEN?  WHY?  How?         ...        159 
By  James  A.  Farrell, 
President  of  the  United  States  Steel  Corporation 

XVII    GIVING  THE  MEN  A  CHANCE — WHAT  IT'S  DOING  FOR  FORD     1 67 

By  Harry  Franklin  Porter, 
Organization  Engineer 

XVIII     HELPING  EMPLOYEES  TO  SAVE 183 

By  Stanley  A.  Dennis 
Based  on  an  extensive  investigation 

XIX     YOUR  RIGHT  IN  YOUR  EMPLOYEE'S  INVENTIONS   .        ,        198 
By  Joseph  W.  Hays, 
Combustion  Engineer 


SPECIAL   ILLUSTRATIONS 

1      QUESTIONS  THAT  HELP  IN  HIRING 33 

II  A   CARD   THAT  CHECKS   ON   EX-WORKERS       ....  41 

III  THE  ROCKEFELLER  PLAN  FOR  HANDLING  MEN         ...  85 

VI  SHOULD    EMPLOYERS   ASK   THEMSELVES   THESE   QUESTIONS?  109 

v    THE  EMPLOYEES'  BANK  PASS  BOOK 186 

VI  A   SUCCESSFUL   LOAN   APPLICATION    FORM      ....  188 

vu  WHEN  ONE  EMPLOYEES'  SAVINGS  ASSOCIATION  LOANS  .        .  191 


PART  I-SELECTING  AND 
HIRING 

My  Measure  of  Success 

'T'HE  architect  and  executive  who  design  and 

*  direct  and   yet  strive  to  do  the  bricklaying, 

will  advance  not  far  and  will  quickly  wear  out. 

One  who  has  the  faculty  for  right  selection  of 
responsible  subordinates  needs  also  that  wise 
sense  of  justice  and  appreciation  wrhich  accords 
unstinted  scope  of  action  and  generous  recogni- 
tion of  results. 

The  proverbial  reluctance  to  allow  those  to 
enter  the  water  whom  we  would  have  swim  has 
given  short  measure  to  many  a  success. 

A  good  executive  finds,  develops  and  leans 
upon  those  who  can  carry  forward  for  him  the 
increasing  divisions  of  his  single  great  work. 

In  all  work,  as  in  all  knowledge,  there  is  un- 
limited room  for  expansion  and  advancement. 
The  business  pyramid  will  find  no  circumscribing 
dome  above  which  it  cannot  lift  its  capstone. 

Therefore,  granted  breadth  of  field  and  the 
leader's  personal  equation,  the  degree  and  height 
of  business  mastery  and  success  will  accord 
absolutely  with  the  number  and  efficiency  of  the 
supporting  body  of  workers. 

And  the  executive  will  have  the  deserved 
praise  and  reward  of  one  whose  admirable  work 
has  been  to  lead,  to  develop,  to  render  produc- 
tive; to  add  to  the  commonwealth  of  brain  and 
things  and  character. 


JOHN  WANAMAKER 

President,  The  Wanamaker  Stores 


HOW  WE  LIFTED  HIRING 
OUT  OF  THE  RUT 

By  A.  K.  Baer, 
Secretary-Treasurer,  Strouse-Baer  Company 

BALTIMORE  is  quite  a  center  for  the  manufacture 
of  wearing  apparel.  These  factories  use  women 
employees  almost  exclusively.  The  increased  produc- 
tions that  have  been  made  necessary  by  the  increased 
demand  for  merchandise  recently  have  compelled  all 
manufacturers  to  have  their  plants  running  to  capacity, 
and,  in  a  great  number  of  instances,  additions  have  been 
made  which  also  called  for  enlarged  forces.  This  condi- 
tion was  made  more  serious  by  the  fact  that  there  has 
been  an  unusual  increase  in  new  factories  in  the  same 
line. 

To  secure  sufficient  workers,  who  are  to  some  degree 
experienced,  has  produced  a  bid  for  them  by  every 
factory  in  the  city.  These  appeals  have  heretofore  been 
made  in  the  usual  stereotyped  way  in  the  want  columns 
of  the  various  newspapers.  In  fact,  there  are  at  all 
times  and  have  been  for  quite  a  number  of  years,  "Help 
Ads"  of  this  character  appearing  nearly  every  day  in 
these  columns,  so  when  workers  were  looking  for  posi- 
tions they  saw  the  same  sort  of  appeals  by  any  number 
of  manufacturers,  and  therefore,  these  "ads"  became 
commonplace. 

One  month  we  had  continuous  want  ads  running  in  the 
classified  columns  of  the  daily  papers,  and  our  total 


10 SELECTING  AND   HIRING 

results  in  applications  which  were  accepted  were  only 
six,  upon  an  expenditure  approximately  of  one  hundred 
and  twenty-five  dollars.  Our  business  has  expanded  to 
such  an  extent  that  it  was  necessary  for  us  to  increase 
our  production  thirty-three  per  cent,  which  means  that 
we  had  to  put  in  sixty  additional  machines.  With  the 
experience  of  our  previous  month 's  advertising  for  help 
staring  us  in  the  face,  and  knowing  that  we  had  to  fill 
up  our  new  plant  within  a  very  short  period,  we  were 
confronted  with  a  serious  problem.  Our  solution  was 
an  advertising  campaign  which  is  along  lines  quite  differ- 
ent from  those  usually  followed  in  employment  "ads." 
It  has  been  highly  satisfactory,  for  by  it  we  have  filled 
up  our  entire  plant  with  experienced  help. 

Everybody  sells  his  product  by  telling  about  it — by 
pointing  out  why  the  buyer  should  purchase,  by  showing 
him  the  advantages  that  go  with  the  goods.  Why 
shouldn't  we  use  these  common-sense  methods  when  we 
hire  workers?  Why  not  give  them  reasons  why  the 
employment  we  have  to  offer  is  desirable?  Why  not 
"sell''  our  good  working  conditions  as  we  sell  goods? 
This  line  of  thought  seemed  reasonable.  But  how  should 
it  be  done  ?  If  a  person  is  out  hunting  for  employment 
and  must  have  it,  you  get  him  to  come  to  you  by  the 
stereotyped  want  ads.  But  you  can't  do  much  toward 
creating  a  particular  desire  to  work  for  you  on  the  part 
of  the  prospective  employee  in  the  uniform  type  and 
narrow  confines  of  a  classified  ad  in  the  daily  papers. 

So  we  decided  to  do  some  pioneer  work.  We  took 
approximately  half  pages  in  the  Sunday  papers  for  three 
successive  weeks.  This  gave  us  ample  room  to  tell  why 
our  factory  is  a  good  place  to  work  in.  Good  ventilation 
and  heating,  excellent  lighting  facilities  and  clean,  con- 
venient rest  rooms  in  a  fireproof  building — these  are 


CAPITALIZING  THE  JOB'S  GOOD  POINTS      11 

points  about  our  factory  that  we  pointed  out  in  each 
advertisement. 

"What's  in  the  pay  envelope,  week  after  week?"  is 
a  question  every  applicant  is  going  to  ask  in  one  form 
or  another,  so  we  headed  one  of  our  advertisements  that 
way  and  then  by  a  table  showed  in  dollars  and  cents 
exactly  what  eight  representative  operators  earned  dur- 
ing each  of  seven  specific  weeks.  We  compared  the  wages 
our  girls  make  with  those  earned  by  the  average  operator. 
But  skyrocket  wages  over  a  brief  period  are  of  little 
interest  if  they  are  eaten  up  by  slack  periods,  so  we 
brought  out  the  uniformity  of  employment  in  this 
sentence,  "There  has  been  no  slack  season  in  more  than 
three  years — no  operators  have  been  laid  off  for  lack 
of  work — every  operator  has  had  full  time."  "Two- 
thirds  of  the  operators  who  were  here  when  we  began 
over  three  years  ago  are  here  now,"  is  another  fact  we 
thought  worth  bringing  out  in  the  advertisement,  be- 
cause, after  all,  "the  proof  of  the  pudding  is  in  the 
eating. ' ' 

HOW  the  attractiveness  of  working  conditions  can  be 
played  up  to  advantage  in   "help  wanted"  copy 
and  attract  employees  of  a  high  standard. 

We  have  new  machines  and  keep  them  maintained  in 
the  best  of  condition.  We  thought  this  well  worth  men- 
tioning, for  it  has  a  bearing  on  an  employee's  output 
and  earning  power.  And  we  didn't  forget  pictures. 
Photographs  do  much  in  visualizing  conditions,  and  we 
made  ample  use  of  them  in  these  advertisements.  We 
showed  not  only  our  workrooms,  but  individual  pictures 
of  a  half  dozen  of  our  operators  under  the  caption,  "We 
Want  More  Operators  Like  These." 


SELECTING   AND   HIRING 


The  psychological  effect  of  these  advertisements  -upon 
the  girls  and  women  who  are  required  to  earn  a  liveli- 
hood has  been  unusual,  for  it  brought  to  the  notice  of  a 
great  portion  of  prospectives,  the  possibility  of  earning 
salaries  in  excess  of  what  can  be  obtained  in  other  lines 
of  female  endeavor,  such  as  office  workers  or  shop  girls. 
It  must  be  further  taken  into  consideration  that  the  ele- 
ment of  foreign  female  help  in  Baltimore  is  almost  a 
nonentity,  and  factory  work  to  a  great  portion  of  Ameri- 
can girls  bears  almost  the  same  stigma  as  that  of  a 
housemaid.  It  is,  therefore,  necessary  to  consider  our 
advertising  for  help  as  sort  of  an  educational  campaign, 
in  connection  with  a  direct  appeal  for  experienced  help. 

Within  our  plant  as  well  we  have  taken  steps  to  build 
up  our  working  force.  We  have  posted  in  prominent 
places  in  the  workrooms  signs  headed,  "Help  yourself 
by  helping  us.  '  '  The  announcement  itself  is  made  up  of 
an  offer  of  ten  dollars  to  any  employee  who  secures  the 
services  of  three  experienced  operators  and  three  dollars 
for  one  skilled  operator.  This  is  provided  the  operators 
thus  obtained  remain  in  our  employ  at  least  three 
months. 

It  is  difficult  to  say  whether  the  sort  of  an  appeal 
made  in  our  special  advertising  campaign  for  workers 
could  be  used  generally.  A  campaign  of  this  sort  would 
necessarily  depend  upon  individual  conditions.  But  in 
our  case  it  has  done  what  we  hoped  it  would  do.  It  has 
given  us  a  full  quota  of  employees  of  a  high  standard. 


ONE  reckless  workman  has  time  and  again  spoiled  the 
"safety  first"  spirit  of  a  whole,  shop,  while  a  run  of  accu- 
rate and  fine  work  has  more  than  once  toned  up  careless 
habits  throughout — has  made  better  workmen  and  cut  inspec- 
tion costs.  HARRY  A.  WHEELER, 

Vice-President,  of  the  Union  Trust  Company,  Chicago 


II 

LIVING  UP  TO  YOUR  EMPLOY- 
MENT SYSTEM 

By  Carroll  D.  Murphy 
Based  on  an  Extensive  Investigation 

AUDITING  employment  conditions  at  the  branch 
i~\.  sales  offices  had  kept  the  traveling  "trouble  man" 
i»f  a  big  implement  concern  in  upper  Missouri  territory 
for  three  full  weeks.  He  had  examined  new  and  sea- 
soned salesmen,  had  held  training  conferences,  had 
checked  personal  sales  records,  had  called  in  and  lunched 
with  the  star  men  and  "trailers"  from  odd  corners  of 
the  field.  In  every  way  possible  under  his  authority, 
he  had  standardized  the  employment  routine  of  the 
branch  and  had  brought  it  into  line  with  home  office 
policy.  Yet  in  his  primary  mission  he  had  failed — 
failed  because  the  employment  system  of  which  he  was 
a  part  was  incomplete. 

In  his  pocket  he  carried  a  telegram  ordering  him  to 
run  in  from  Denver  and  find  why  upper  Missouri  sales 
showed  a  slump.  And  having  found  the  trouble,  he  had 
found  also  that  he  lacked  the  power  to  meet  it. 

"You've  decided  to  give  "Wilson  that  new  agency?" 
he  inquired  with  pretended  confidence,  as  he  sat  closeted 
with  the  branch  manager  on  the  last  night  of  his  stay. 

"I'm  firing  Wilson  tomorrow,"  was  the  curt  reply. 

"But  he's  your  oldest  man  and  the  best  salesman  on 
your  payroll.  He  knows  that  territory  as  no  one  else 


14 SELECTING  AND   HIRING 

does.  He  has  earned  the  promotion  and  to  push  him 
out  instead  of  giving  it  to  him  will  discourage  your  whole 
force.  The  home  office  has  noticed  the  difference  already. 
In  fact,  I  don't  see  how  you  personally  can  afford  to 
let  him  out.  He  has  worked  up  his  trade  to  $8,000  and 
$10,000  months  when  his  nearest  man  runs  $3,500.  To 
lose  him  will  cut  down  your  bonus  and  spoil  the  record 
of  the  branch." 

"I  won't  have  Wilson  around,"  said  the  bran,eh 
manager  with  finality. 

"Suppose  you  hold  him  over  a  couple  of  weeks  and 
recommend  him  for  some  other  territory.  He's  too 
valuable  a  man  to  let  go.  I'll  report  him  in  and  have 
him  shifted, ' '  the  adjuster  suggested. 

"I'm  firing  him,"  was  the  answer,  doggedly  given. 

Next  day  the  adjuster  brought  Wilson's  case  before 
the  division  sales  manager  in  charge  of  ten  branches 
covering  several  of  the  prairie  states.  He  explained 
that  the  salesman's  record  was  sound;  that  there  were 
no  specific  charges  against  Wilson ;  that  the  dismissal  of 
the  man  who  was  in  line  and  the  promotion  of  a  favorite 
would  surely  spread  discontent  throughout  the  field 
force.  The  division  manager,  however,  held  that  it  would 
be  a  mistake  for  him  to  interfere  with  the  branch  man- 
ager's policy — would  make  him  "responsible  for  any 
bad  luck  the  branch  might  strike." 

WAYS  to  lessen  the  friction  in  handling  men  which 
often  develops  through  office  politics  or  through  an 
employee's  fear  of  the  other  fellow  "getting  his  job". 

Ten  days  later  the  trouble  man  laid  the  case  before 
the  general  sales  manager.  "Our  employment  plan  is 
incomplete,"  he  said,  "unless  we  back  up  our  bonus 
system  of  payment  with  an  employment  committee  and 


WATCHING  EMPLOYMENT  CONDITIONS      15 

arbitration  board  or  some  home  office  check  on  politics 
in  the  branches." 

The  sales  manager  stared  out  of  the  window  for  a  full 
minute,  then  shook  his  head.  "The  only  thing  I  could 
do,"  he  declared,  "would  be  to  remove  both  the  division 
and  the  branch  manager.  Wilson  isn't  worth  it,  good 
salesman  as  he  is." 

What  this  scheme  of  employment  lacked  was  a  means 
or  method  of  enforcing  its  provisions.  Hiring  stand- 
ards, merit  standards,  contests  and  enthusiasm-getting 
schemes  had  all  been  worked  out  on  a  fair-weather  basis. 
If  the  one  responsible  at  each  point  had  been  entirely 
sound,  the  plan  would  have  worked.  But  it  lacked  that 
final,  positive  authority  which  urges  or  forces  every  man 
to  keep  to  the  rules  in  time  of  stress  because  a  bigger 
power  in  the  company  will  bring  him  back  to  them  if 
he  takes  any  byroad  of  carelessness,  selfishness  or 
favoritism. 

Ask  the  enthusiastic  employment  chief  who  has  told 
you  his  hobbies  in  man-handling  this  plain  question: 
' '  Does  it  work — does  your  employment  system  as  a  whole 
satisfy  you?"  Never  is  the  answer  an  unqualified 
"yes."  Various  plans  are  shrewd  in  making  men  and 
managers  observe  the  routine  of  hiring,  discipline  or 
payment.  But  we  have  not  yet  worked  out  any  system 
so  complete  and  well  balanced  that  it  does  not  break 
down  somewhere  in  time  of  trouble.  What  every  man- 
ager is  looking  for  is  an  employment  plan  which  will 
work  to  the  rules  as  closely  as  the  checking  system  in 
the  average  bank  and  at  the  same  time  not  create  a 
spirit  of  discontent  among  the  workers. 

Just  as  the  bank's  checking  rules  fall  into  groups  of 
essentials,  so  you  can  put  on  the  fingers  of  one  hand  the 
five  essentials  of  labor  buying : 


16 SELECTING   AND   HIRING 

(1)  An  employment  bureau  which  shall  look  out 
for  the  labor  supply,  keep  the  best  men  available  and 
put  each  new  workman  where  he  fits. 

(2)  A   staff  or   instruction  plan   for  training  and 
developing  your  workers. 

(3)  A  system  of  records  and  conferences  to  get  a 
fair  decision  on  every  man 's  ability. 

(4)  A  method  of  shifting  men  to  put  ability  on  its 
most  productive  basis. 

(5)  Such  rules  as  to  pay,  promotions,  and  other  re- 
wards as  will  stimulate  everyone  to  do  his  best  at  each 
stage  of  his  development. 

After  the  rules,  card  forms,  positions  and  methods 
have  been  worked  out,  however,  the  sixth  essential — 
the  power  that  clinches  these  fingers  into  a  solid  grip 
on  progressive  employment  policy — is  the  provision 
which  the  management  makes  to  guard  these  rules  and 
methods  from  neglect  at  all  points.  As  the  bank  says : 

"These  things  will  be  done  because  no  payments  will 
be  made  otherwise,"  so  the  manager  must  be  assured 
that  no  variation  from  his  plans  can  pass  unchallenged. 

Most  employers  recognize  that  friction  in  handling  the 
force  focuses  at  certain  points.  The  hiring  department 
in  a  big  public  service  company,  for  example,  has  a 
complete  routine  for  the  picking  of  good  men,  but  the 
spirit  of  personal  enthusiasm  and  responsibility  behind 
the  plan  has  gone  out — the  man  at  the  first  desk,  where 
sixty  per  cent  of  all  who  apply  could  economically  be 
rejected,  is  dispirited,  routine-ridden,  weak  in  his  judg- 
ments of  men. 

Rulings  that  urge  the  training  of  men  are  found  fre- 
quently to  induce  friction ;  the  man  who  should  be  de- 
veloping new  material  for  various  places  is  "afraid  of 
his  job. "  He  tries  to  make  an  extra  showing  of  economy 


WATCHING  EMPLOYMENT  CONDITIONS      17 

or  of  personal  ability  and  so  crowds  down  or  neglects 
his  men  that  his  staff  is  constantly  crumbling  to  pieces. 
Investigation  of  the  city  sales  office  of  a  computing 
machine  company  showed  that  salesmen  had  often  been 
driven  away  by  the  office  manager's  eagerness  to  credit 
himself  with  telephone  sales  from  the  territory  assigned 
to  these  men.  The  illness  of  an  estimator  in  a  con- 
tracting company  brought  out  the  fact  that  for  three 
years  he  had  been  holding  back  the  coaching  he  had 
promised  to  an  assistant.  At  one  time  he  was  too  busy, 
at  another  his  place  seemed  too  uncertain,  and  again 
he  had  a  friend  in  mind  for  the  opening  and  so  neg- 
lected his  first  duty. 

METHODS  for  building  a  strong   and   enthusiastic 
working  force  by  detecting  and   eradicating   weak 
points  in  the  employment  system. 

Such  fears,  rivalries  and  cases  of  neglect  dot  most 
organizations  and  become  centers  of  disloyalty.  Yet 
simple  foresight  and  the  common-sense  application  of 
yesterday's  experience  will  quickly  tell  any  employer 
just  where  his  employment  plan  needs  to  be  reenforced. 

The  president  of  one  $50,000  concern  has  been  able 
to  build  up  a  strong  and  enthusiastic  corps  of  workers 
simply  because  he  tactfully  anticipates  and  quietly 
avoids  friction  in  the  enforcement  of  his  employment 
scheme.  The  need  developed  for  a  new  department  head 
in  this  company.  The  president  wished  to  make  it  a  rule 
that  promotions  be  awarded  to  the  present  employees 
best  fitted  for  it,  yet  he  foresaw  that  several  executives 
would  begrudge  him  certain  able  assistants. 

In  fairness  to  the  men  who  had  earned  advancement 
and  to  the  heads,  who  might  be  prejudiced  by  their  own 
convenience,  therefore,  the  president  adopted  the  prac- 


18 SELECTING   AND   HIRING 

tice  of  dropping  in  upon  the  department  work  and 
studying  the  fitness  of  the  men  in  line  for  the  vacancy. 
When  he  had  practically  chosen  an  assistant  from  the 
sales  department,  he  went  to  the  sales  manager,  told  him 
of  the  vacancy  and  asked  him  to  suggest  several  candi- 
dates for  it.  The  sales  manager,  knowing  that  his 
superior  was  familiar  with  the  abilities  of  his  men,  had 
no  course  but  to  suggest  frankly  that  his  assistant  might 
fit  in.  Eepeated  conferences  took  up  the  promotion  from 
various  angles,  and  made  the  sales  manager  feel  that  he 
was  making  a  voluntary  contribution  to  the  personnel 
of  the  concern,  in  return  for  which  his  employer  was  not 
only  giving  him  full  credit,  but  was  cooperating  in  the 
effort  to  fill  the  assistant's  place  and  thus  minimize  the 
inconvenience  to  the  department.  Against  the  selfish 
instincts  of  the  department  head,  this  employer  matched 
these  stronger  motives  so  tactfully  as  to  inspire  him 
enthusiastically  to  stand  by  a  promotion  on  which  the 
spirit  of  the  younger  workers  in  the  concern  depended. 

In  a  similar  way  every  threatened  point  in  a  scheme 
of  employment  can  be  safeguarded.  Question  your 
employment  system  frankly:  Does  it  work?  Where 
does  it  generate  friction  ?  How  can  it  be  made  trouble- 
proof  ?  In  answer  you  can  blue-pencil  on  the  chart  of 
your  organization  these  spots  where  fear  of  personal  dis- 
advantage, hostility  between  men,  favoritism,  self-im- 
portance, ignorance,  neglect,  snap  judgment,  overwork 
or  an  unbalanced  plan  of  payment  threatens  to  make 
the  bearings  "smoke." 

Against  every  one  of  these  dangers  the  wide  awake 
manager  has  installed  some  more  or  less  automatic 
safety  device.  The  employment  schemes  which  are  most 
successful  focus  certain  duties  upon  each  worker,  inspire 
him  with  a  sure  reward  for  his  service  and  after  thus 


WATCHING  EMPLOYMENT  CONDITIONS      19 

reenforcing  instruction  with  inspiration,  assure  him  that 
his  record  is  under  inspection  constantly  and  that  he  is 
being  graded  fairly  for  both  failures  and  successes. 

To  be  ready  for  difficulties  is  the  essence  of  a  strong 
man-handling  plan.  Every  belt  and  pulley  of  employ- 
ment routine  needs  back  of  it  both  a  regular  and  an 
emergency  engine.  Not  only  to  insure  him  that  he  gets 
a  fair  return  for  his  wage,  but  also  to  protect  him  from 
favoritism  in  the  department,  the  employee  must  be  left 
no  excuse  of  ignorance  as  to  his  duty,  and  at  least  two 
independent  forces  in  the  company  must  report  sepa- 
rately as  to  his  efficiency.  This  plan  holds  for  the 
individual,  the  department  head,  the  employment  sub- 
committee or  arbitration  board  and  the  employment 
manager. 

In  a  small  factory  reports  on  costs  and  output,  to- 
gether with  shrewd  personal  contact,  tell  the  higher 
officials  from  day  to  day  how  the  department  heads  are 
observing  the  rules  and  holding  their  subordinates  up 
to  the  plan.  As  an  inducement  to  the  workers  to  check 
upon  this  information,  an  annual  bonus  has  been 
arranged  which  reaches  the  older  and  more  trusted  em- 
ployees. Every  spring  the  management  announces  to 
its  men  that  it  has  set  aside  a  certain  unpublished  per- 
centage of  the  profits  to  be  made  in  the  next  twelve 
months,  for  distribution  according  to  wages  among  the 
employees  who  have  long  been  in  the  service  of  the  com- 
pany. About  one  third  of  the  employees  receive  this 
bonus,  and  so  completely  has  it  won  their  cooperation 
that  upon  every  nook  and  corner  of  the  factory  they 
focus  eyes  watchful  for  friction  in  the  handling  of  help. 

In  a  suit-making  plant  the  management  gets  inde- 
pendent reports  on  employment  conditions  from  three 
different  centers  of  responsibility.  The  regular  em- 


20 SELECTING   AND    HIRING 

ployees  are  made  accountable  for  all  new  workers  by  a 
provision  that  no  hiring  shall  be  done  except  on  the 
recommendation  of  steady  help.  Every  case  of  lateness, 
absence  or  continued  inefficiency  is  also  investigated  in 
a  thorough  way  and  from  time  to  time  must  be  reported 
in  outline  to  the  management.  The  usual  output  reports 
keep  the  management  in  touch  with  efficiency  in  the 
shop,  and  the  independent  view  from  a  third  angle  comes 
through  the  work  of  a  woman  disciplinarian,  responsible 
to  the  management  and  in  constant  touch  with  the  fac- 
tory force. 

In  another  and  larger  concern,  a  complete  labor  de- 
partment has  been  organized  where,  through  complaint 
and  suggestion  boxes,  foremen  and  workers  can  file  their 
respective  cases,  throwing  light  from  two  angles  on  con- 
ditions in  the  plant  and  leading  to  corrections  needed. 
Under  this  plan  discharges  were  cut  to  ten  per  cent  of 
the  total  under  a  former  routine.  A  board  of  arbitra- 
tion, in  which  both  department  heads  and  employees  are 
represented,  acts  as  a  court  of  appeal  from  labor  depart- 
ment decisions,  and  has  worked  out  a  code  by  which  the 
labor  department  is  guided. 

HOW   a   special  investigation  at  stated  intervals  can 
be  used  to  bring  to  light  mistakes  in  hiring,  abuse 
of  the  promotion  power,  and  the  like. 

In  another  concern,  no  man  can  be  retained  in  one 
department  for  more  than  three  years  without  bringing, 
by  automatic  follow-up,  a  special  investigation.  At  this 
time  the  employee's  record  is  brought  out  and  the  whole 
situation  comes  under  scrutiny.  Mistakes  in  hiring, 
neglect  of  training,  wrong  judgment  of  the  man  and 
abuse  of  the  promotion  power  thus  come  to  correction. 
Whenever  a  vacancy  occurs,  moreover,  the  employment 


WATCHING  EMPLOYMENT  CONDITIONS      21 

committee  of  this  company,  perhaps  in  the  most  unex- 
pected way,  brings  out  the  records  of  all  men  in  a  de- 
partment, calls  various  chiefs  into  conference  and  thus, 
as  often  as  vacancies  occur,  inakes  a  special  test  of 
employment  conditions. 

Enforcing  an  employment  system  predicates  that  in- 
formation on  every  point  shall  come  from  several  angles 
surely  and  often  to  the  man  most  interested  in  the  suc- 
cess of  the  business.  By  getting  this  routine  on  paper, 
the  prime  mover  can  enforce  a  simple  automatic  follow- 
up.  This  is  the  method  in  use  by  a  New  York  publishing 
house  with  branches  all  over  America.  In  the  manager's 
office,  agency  difficulties  have  been  reduced  to  a  series 
of  charts  or  "trouble  sheets."  The  branch  manager  is 
constantly  in  touch  with  the  house  by  reports  on  sales, 
collections,  expense  and  man-handling.  When  a  sales 
report  shows  a  slump,  the  general  manager  checks  down 
his  "sales  trouble  sheet"  and,  by  correspondence  or  if 
necessary  by  personal  conference,  puts  a  finger  on  his 
man's  difficulty.  Branch  managers  soon  come  to  know 
that  they  are  on  their  record — that  what  they  do  is  in 
the  lime  light  and  that  their  faults  will  be  known  just 
as  surely  as  their  difficulties  and  efforts. 

In  order  further  to  emphasize  the  rules  without 
offending  the  field  men,  the  financial  reports  sent  in  by 
different  branches  are  scored  and  reported  weekly  as  a 
base  ball  contest,  in  which  the  winning  team  is  the  one 
doing  the  best  business  for  the  week.  The  branch  man- 
ager's  personal  reports  are  developed  into  humorous  but 
straight-from-the-shoulder  comment.  Checking  back 
upon  the  branch  manager  and  his  men  at  a  different 
angle  from  that  of  his  immediate  superior,  come  this 
bulletin  and  a  weekly  statement  showing  each  man  just 
how  his  work  compares  with  that  of  the  other  men.  This 


SELECTING  AND  HIRING 


double  attack  rouses  the  ambition  of  managers  and  men, 
and  makes  them  clamor  for  suggestions  from  the  trouble 
sheet  at  the  home  office. 

The  unorganized  factory  force  has  as  many  conflicting 
interests  as  the  arrows  that  dot  a  weather  map.  Re- 
sourceful employers  find  plans  to  line  up  these  interests 
for  a  time  and  make  them  all  run  parallel  with  the  suc- 
cess of  the  house.  The  tactful  paymaster  appeals  to  the 
personal  advantage  and  success  of  the  individual  and  so 
stimulates  him  to  contribute  to  the  success  of  the  house. 
He  shows  the  worker  that  his  own  failure  threatens 
whenever  he  threatens  the  welfare  of  the  concern.  He 
appeals  to  the  caution  and  the  pride  of  his  man.  But 
his  system  is  often  only  a  matter  of  enthusiasm;  his 
team  is  held  together  but  temporarily  and  by  the  force 
of  his  personality,  unless  he  inserts  at  every  important 
friction  point  in  his  employment  scheme  a  make-sure 
clause  —  an  emergency  engine  which  is  bound  to  put 
through  the  routine  if  the  regular  power  goes  off.  Small 
details  are  entered  by  a  subordinate,  whose  reports  are 
verified  through  an  independent  source.  Step  by  step 
the  details  are  cleared  away  and  the  essentials  of  the 
system  focused,  until  finally  the  employer  or  general 
manager  gets  the  essential  proofs  that  the  routine  is  run- 
ning smoothly. 

The  best  of  employment  schemes  will  not  win  the 
workman's  respect,  inspire  his  confidence  and  get  results 
without  the  driving  force  and  will  power  of  the 
employer  steadily  behind  it.  Spurts  of  man-handling 
punctuated  by  forgetfulness  will  not  succeed.  Employ- 
ment is  an  executive  task  which  demands  regular  hours, 
a  place  on  the  calendar,  perpetual  responsibility  on  the 
part  of  those  immediately  in  charge  and  periodical  at- 
tention from  the  manager.  Because  wages  are  only  an 


WATCHING  EMPLOYMENT  CONDITIONS      23 

external  check  on  men,  the  wise  employer  goes  beyond 
his  pay  roll  auditor,  makes  someone  responsible  for  per- 
sonal supervision  of  every  employment  detail,  and  sets 
a  second  agent  to  audit  and  correct  the  other's  errors 
and  personal  equation.  The  trouble  sheet  and  the 
employer's  reports  close  the  magnetic  circuit  of  efficient 
work. 


l/i FFICIENCY  like  an  invention  always  comes  to  an 
•I— d  individual,  neven  to  a  committee  or  to  an  organization, 
and  the  weakness  of  cooperative  production  is  the  under- 
valuation of  the  individual,  the  manager  who  develops  effi- 
ciency in  other  men.  In  most  spheres  of  action  and  in  the 
economic  world  in  particular,  some  men  are  much  more 
efficient  than  others.  Some  men  possess  much  more  ability 
than  the  majority  of  their  fellows  and  among  this  higher  class 
there  are  varying  degrees  of  efficiency.  Modern  industry 
has  been  developed  through  the  invention  of  efficient  ma- 
chinery. Man  efficiency,  however,  is  today  of  far  greater 
importance  than  the  further  development  of  efficiency  in 
machinery,  the  greatest  problem  before  us  today  is  not  so 
much  the  further  improvement  of  machinery,  but  the  develop- 
ment of  an  increased  efficiency  in  men." 

JAMES  LOGAN, 

Chairman  of  the  Board  and  General  Manager 
of  the  United  States  Envelope  Company 


m 

WHEN  YOUR  MEN  HELP 
YOU  HIRE 

By  Charles  Harris 
Based  on  an  Extensive  Investigation 

ONE  of  the  most  successful  engineers  I  ever  knew 
attributed  most  of  his  own  success  to  the  class  of 
help  he  had  been  able  to  employ  for  his  department  and, 
indirectly,  to  a  policy  he  had  long  followed  in  the  selec- 
tion of  his  assistants. 

His  policy  really  came  about  through  accident  orig- 
inally. It  was  some  time  before  he  analyzed  the  situation 
and  applied  the  policy  in  an  intense  and  unvarying 
fashion.  In  the  beginning,  he  had  happened  to  get 
a  capable  man  or  two  from  this  school  and  they,  in  turn, 
had  recommended  others  from  time  to  time,  finally 
he  came  to  a  realization  of  the  fact  that  he  was  depend- 
ing to  a  marked  degree  on  the  men  from  this  school. 
He  thought  the  matter  over  and  awoke  to  the  value  of 
his  "discovery." 

"Capable  men  can  distinguish  capable  from  incapable 
people  among  their  friends,"  he  said.  "Moreover,  a 
capable  man  will,  as  a  rule,  have  capable  men  for  his 
friends.  I  would  therefore  rather  hire  men  on  the 
recommendation  of  my  more  capable  men  than  through 
any  other  source.  As  to  the  men  from  this  particular 
school,  I  know  full  well  that  there  are  other  schools  in 
the  country  as  good.  Probably  some  are  better.  I  used 


COOPERATION   IN   HIRING 


to  believe  that  this  school's  training,  some  way,  pecu- 
liarly fitted  men  for  my  business.  But  that  is  not  true  — 
decidedly  not  true. 

"My  success  with  these  men  has  been  because  the 
men  I  had,  being  capable,  knew  and  recommended 
capable  people.  Moreover,  there  has  always  been  a  sort 
of  'community  of  responsibility'  among  the  employees 
from  this  school.  Every  man  from  the  institution  is 
proud  of  the  record  of  every  other  man  in  the  depart- 
ment from  the  same  school.  The  older  men  will  sort  of 
'father'  a  new  man  from  the  school  —  will  help  him  with 
infinite  patience.  Thus,  from  a  class  of  many  students 
and  one  teacher,  at  the  school,  the  new  man  comes  into 
a  class  of  one  student  and  several  interested  and  very 
practical  teachers  here.  '  ' 

This  is  one  man's  interesting  formula  for  obtaining 
good  help,  applicable,  apparently,  to  his  line,  but  not 
applicable  in  the  cases  of  the  great  mass  of  employees. 
However,  at  least  a  part  of  the  plan  is  being  applied 
right  now,  in  the  selection  of  women  employees  for  one 
of  the  largest  pharmaceutical  manufacturing  houses  in 
the  country.  In  the  city  where  this  company's  chief 
plant  is  situated,  it  is  known  as  a  place  which  attracts 
unusually  high  class  employees,  both  men  and  women. 

The  whole  success  of  the  company  in  this  particular, 
according  to  its  president,  has  come  from  the  logic  that 
"nice  people  will  have  nice  friends."  It  has,  therefore, 
been  the  policy  of  the  various  department  foremen,  in 
seeking  new  help,  to  ask  the  more  capable  employees  if 
they  do  not  have  friends  who  would  like  to  work  at  the 
factory.  It  is  naturally  necessary  that  "nice  people" 
should  be  well  treated,  though  they  are  really  not 
unusually  well  paid.  The  desirable  people  in  the  plant 
remain,  also,  through  the  fact  that  the  other  people  are 


26 SELECTING   AND   HIRING 

"nice  people" — the  sort  of  people  who  are  agreeable 
to  them  as  associates.  The  very  reputation  of  the  fac- 
tory as  a  pleasant  place  to  work,  has  of  itself  become 
a  valuable  word-of-mouth  advertisement  for  capable 
people.  In  this  case,  the  treatment  of  the  employees 
is  a  matter  of  great  importance,  of  course,  as  in  every 
such  plan,  but  it  is  never  the  effort  of  the  company  to 
start  with  a  decidedly  incapable  person. 

I  know  the  manager  of  a  garment  factory  which  em- 
ploys women  almost  exclusively,  and  whose  employees 
are  known  as  the  best  in  the  city  where  his  company 
operates,  as  the  result  of  close  attention  to  the  two  ideas 
of  careful  selection  and  careful  treatment  of  the 
employees  selected.  Like  many  other  lines  employing 
women,  it  is  the  rule  of  the  trade  that  employees  are 
prone  to  go  from  shop  to  shop,  often  for  no  very  apparent 
reason.  "Just  want  to  change,"  in  fact,  is  often  as 
much  as  the  manager  can  get  from  such  an  employee. 

IN  THIS  case  real  interest  in  the  worker's  personal 
comfort  paid  dividends  in  good  will.     How  welfare 
work  without  "frills"  is  conducted. 

Several  years  ago,  this  manager  decided  to  turn  this 
trait  to  his  own  advantage  and  determined  to  keep,  per- 
manently, a  greater  proportion  of  the  really  capable 
people  who  came  from  time  to  time  than  he  should  lose. 
"We  have  made  a  careful  study  of  the  comfort  of  our 
girls,"  he  said,  "and  of  their  feelings.  We  give  especial 
attention  to  the  more  capable  ones,  of  course.  This  policy 
goes  far  beyond  the  maintenance  of  our  dining  room 
for  employees — far  beyond  the  annual  dinner  and  the 
dances  we  allow  them  to  have  here.  It  goes  into  their 
everyday  routine  work.  We  let  it  be  known  that  we 
do  not  want  a  girl  in  this  factory  who  has  to  be  railed 


^ COOPERATION   IN  HIRING 27 

at.  We  have  cool-headed  girls — employees  who,  when 
they  feel  they  have  been  unfairly  treated,  will  never- 
theless talk  the  matter  over  in  a  cool  way.  We  let  it  be 
known  that  we  will  protect  the  rights  of  the  girls  and 
that  we  are  very  much  interested,  also,  in  our  own  rights 
as  employers.  The  result  is  that  they  understand  us 
and  we  understand  them  in  an  unusual  way.  We  are 
getting  and  holding  the  better  class  of  employees,  and 
we  are  getting  out  more  work,  mechanical  equipment 
and  floor  space  considered,  than  we  used  to  be  able  to 
turn  out." 

This  manager,  with  the  company  many  years,  believes 
that  fully  half  the  women  are  older  in  the  service  than 
he,  and  many  of  them  have  been  there  for  more  than 
twenty  years.  He  takes  into  account,  also,  the  fact  that 
one  of  the  big  considerations  an  employee  gives  a 
prospective  place  of  employment  is  the  question  of  the 
wages  possible  to  earn,  and  inasmuch  as  practically  all 
the  lafcor  is  paid  by  the  piece,  his  policies  in  this  par- 
ticular have  been  of  great  help.  He  has  tried  to  make 
it  possible  for  the  women  to  make  more. 

For  example,  he  found  occasionally  what  seemed  to 
him  to  be  a  needlessly  large  investment  in  stock  in 
process  of  making.  His  investigation  showed  this  con- 
dition to  be  due  to  the  fact  that  there  were  occasional 
variations  in  the  working  forces  of  the  several  depart- 
ments— old  employees  were  away,  less  capable  substi- 
tutes were  working,  and  so  on.  Such  a  condition  was 
bad  for  the  factory  and  bad  for  the  women  alike.  He 
made  inquiry  in  the  various  departments  as  to  people 
who  could  do  the  work  of  other  departments  in  an  emer- 
gency, many  in  the  past  having  changed  from  one 
department  to  another.  He  then  made  sure  that  the 
girls  understood  that  the  plan  he  had  in  mind  would 


28 SELECTING  AND  HIRING 

be  good  for  them  as  well  as  for  the  owners,  and  sug- 
gested that  certain  employees  form  a  sort  of  reserve, 
in  case  of  such  emergencies,  for  work  in  congested 
departments. 

Now,  if  Department  No.  1  is  about  to  swamp  Depart- 
ment No.  2,  so  that  employees  of  Department  No.  1  may 
have  to  be  laid  off,  and  Department  No.  3,  No.  4  and 
so  on,  are  working  short  time  because  the  goods  are 
accumulating  in  Department  No.  2,  girls  who  know 
the  work  of  Department  No.  2  are  sent  into  that  work 
from  various  departments  until  the  situation  is  relieved 
and  the  equilibrium  reestablished.  The  result  is  that 
the  employees  of  the  various  departments  make  more 
money.  The  girls  were  quick  to  see  this,  and  there  was 
practically  no  trouble,  anticipated  before  the  plan  was 
tried,  with  girls  who  had  for  one  reason  or  another 
preferred  the  department  of  current  steady  employ- 
ment. They  were  willing  to  go  temporarily  to  their  old 
employment  for  the  good  of  the  force  generally. 

In  such  matters  as  a  better  standardization  for  but- 
tonhole markings,  this  manager  has  also  gained  the  favor 
of  his  employees.  In  another  case,  a  small  machine  was 
devised  to  cut  elastic  used  for  overalls  into  uniform 
lengths  with  an  automatic  cutter,  thus  making  assembling 
easier  for  those  who  handle  the  elastic — and,  inci- 
dentally, saving  the  company  much  money. 

This  manager  believes  that  too  many  executives  only 
see  in  such  improvements  the  advantages  which  come  to 
the  company  and  fail  to  recognize  the  benefit  which  can 
come  to  the  employees  and  which,  when  it  is  brought 
adroitly  to  their  attention,  will  make  them  feel  in  a 
more  kindly  way  toward  the  company.  "When  we 
have  an  opportunity  to  improve  a  method,"  he  said, 
"there  are  two  things  that  appeal  to  me  most  strongly. 


COOPERATION   IN   HIRING 29 

In  the  first  place,  how  will  the  change  make  us  money? 
In  the  second  place,  how  can  the  girls  be  shown  that  the 
change  will  be  good  for  them?" 

He  often  goes  through  the  factory  on  deliberate  tours 
of  "friend-making,"  stopping  often  for  a  moment's 
chat  with  the  more  capable  women,  discussing  the 
machines  with  them,  assuring  this  operator  of  a  button- 
hole machine  that  he  will  have  a  man  from  the  factory 
to  look  at  it,  requesting  that  the  other  girl  use  one  of 
the  extra  bench  machines  until  the  guard  on  her  machine 
can  be  repaired — taking,  in  other  words,  a  personal 
interest  in  the  work,  earnings  and  safety  of  each  girl, 
and  letting  her  know  of  his  interest. 

In  a  somewhat  similar  way,  a  manufacturer  who  main- 
tains a  dining  room  for  his  employees  makes  the  dining 
room  pay  unusually  large  "dividends  in  good  will" 
from  his  working  people  by  frequently  going  about  the 
dining  room,  very  much  as  the  proprietor  of  a  public 
eating  house  often  does,  asking  about  the  food  and  the 
service  with  real  concern.  "How's  that  new  pastry 
cook,  John?  Like  her  pies?"  is  bound  to  make  John 
understand  that  the  owner  is  really  interested  in  him, 
and  to  give  the  man  a  better  understanding  of  the  fact 
that  the  dining  room  is  the  result  of  a  real  interest  in 
the  employees.  This  man  believes  that  a  factory  dining 
room,  without  a  sufficient  amount  of  "host  and  guest" 
relationship,  is  quite  as  bad  as  a  hotel  or  restaurant  that 
lacks  this  element  of  personal  interest.  This  employer 
has  always  been  known  as  "a  good  man  to  work  for" 
and  has  been  able  to  employ  and  keep  help  above  the 
average  because  of  his  policies. 

In  a  clothing  factory  where  many  women  are 
employed,  and  where  a  somewhat  similarly  careful  atti- 
tude is  maintained  toward  the  employees  as  a  means  of 


30 SELECTING   AND   HIRING 

attracting  the  best  obtainable,  an  interesting  method  is 
used  for  increasing  the  popularity  of  the  dining  room. 

It  was  found  that  employees  in  some  of  the  depart- 
ments furthest  removed  from  the  factory  dining  room 
would  bring  cold  lunches  and  go  to  the  dining  room  to 
eat  them  rather  than  to  wait  in  the  long  line.  The 
remedy  was  the  dismissal  of  the  four  chief  departments 
five  minutes  apart.  Thus,  there  is  much  less  waiting 
in  line.  The  departments,  of  course,  return  to  work  at 
the  end  of  the  noon  hour  in  the  same  time  relationship. 
Nearly  twenty-five  per  cent  more  are  served  with  warm 
food.  "There  are  times,"  the  owner  of  this  plant  said, 
"when  it  is  wise  to  be  especially  careful  with  help. 
One  of  those  times  is  when  the  employees  are  hungry." 

This  owner  probably  summed  the  whole  story  into  a 
few  words  when  he  said:  "Pay?  It  has  been  the  'mak- 
ing' of  our  business.  You  will  not  find  a  cleaner, 
brighter  or  more  capable  set  of  people  anywhere  than 
we  have  right  here.  What  has  it  cost?  Nothing,  prac- 
tically, in  dollars  and  cents.  It  has  been,  chiefly,  a 
matter  of  thoughtfulness — of  attitude.  A  little  real  con- 
sideration, particularly  in  time  of  fatigue  or  physical 
distress,  counts  for  more  than  all  the  frills  that  can  be 
injected  into  so-called  'welfare'  work  that  is  lacking 
in  this  element." 


OUCCESSFUL  operation  of  any  business — manufactur- 
l*J  ing,  wholesale,  retail — requires  exact  information  about 
every  detail  of  the  business.  The  information  must  be 
obtained  cheaply  and  simply,  but  it  must  be  complete  enough 
and  detailed  enough  to  give  the  executives  who  are  responsible 
for  the  operation  of  the  business  exact  knowledge  of  its  every 

CHARLES  R.  STEVENSON, 
General  Manager,  National  Veneer  Products  Company 


IV 
THE  MAN  FOR  THE  JOB 

By  Carroll  D.  Murphy 
Baaed  on  an  Extensive  Investigation 

TWO  men  met  at  the  revolving  door  of  a  downtown 
restaurant.  They  shook  hands  and  the  older  led 
the  way  to  a  table.  As  they  took  off  their  overcoats  and 
settled  into  chairs,  he  eyed  his  companion  with  keen 
fixity. 

"Well,"  said  he,  "you're  the  man  for  me.  You  live 
up  to  your  telephone  voice."  The  younger  man  looked 
incredulous. 

"What  do  you  know  about  me?"  he  inquired  with; 
amusement.  "We've  exchanged  letters,  made  a  tele- 
phone appointment  and  spent  three  minutes  together. 
Doubtless  some  of  my  friends  have  told  you  the  cus- 
tomary lies  about  my  accomplishments.  Three  weeks 
ago  you  had  never  heard  of  me." 

"Precisely — as  precisely  as  I  should  have  expected 
you  to  draw  a  summary,"  agreed  the  other.  "Let's  get 

down  to  terms "  And  a  bargain  was  struck  which 

brought  the  concern  a  most  valuable  employee. 

' '  Tell  me  how  you  did  it, ' '  urged  the  younger  man,  as 
they  sat  smoking  after  the  meal.  "What  do  you  know 
about  me — how  did  you  get  a  line  on  me?  Although 
your  proposition  looks  good,  I  am  not  sure  that  I  can 
handle  it.  I  have  never  turned  my  hand  to  that  sort  of 
thing.  Aren't  you  taking  a  big  risk?" 

"What  do  I  know  about  you?"  the  older  man  para- 


82 SELECTING   AND   HIRING 

phrased.  "I  know  that  I  have  been  hiring  salesmen 
for  twelve  years  and  studying  my  man.  I  know  that 
I  have  been  selling  specialties  to  business  men  for  sixteen 
years — and  studying  my  man.  I  know  that  you  have 
the  salesman  in  your  signature,  in  the  way  you  phrase 
a  letter,  in  your  voice,  in  the  way  you  carry  yourself, 
in  your  hands,  in  your  eyes,  in  the  shape  of  your  head, 
in  your  nose,  lips  and  chin.  I  know  things  about  you 
that  you  think  are  secrets  from  your  closest  friends.  I 
know,  you  see,  things  that  you  don't  know  yourself. 
There  are  labels  all  over  a  man 's  appearance  and  actions ; 
for  sixteen  years  I  have  been  learning  how  to  read  those 
labels." 

STUDY  and  standardization  of  the  requirements  of 
both  the  job  and  the  man  bring  a  knowledge  of  the 
required  average,  which  is  essential  to  accurate  hiring. 

Such  judgment  of  capacity  may  be  intuitive,  or  it 
may  be  the  trained  and  experienced  character-reading 
ability  which  this  sales  manager  used  so  confidently. 
In  cases  where  the  employer  has  made  character  read- 
ing an  intelligent  study,  astonishing  results  are  some- 
times secured.  And  it  means  dollars  and  cents  to  a 
concern. 

A  $25,000  salary  represented  the  eagerness  of  a  big 
corporation  in  its  search  for  an  efficient  factory  head. 
The  man  whose  resignation  it  had  requested  had  been 
paid  a  salary  and  perquisites  worth  close  to  $32,000. 
Although  a  shrewd  organizer,  accurate  as  an  astronomer 
and  economical  as  a  Yankee  in  his  factory  operation, 
this  superintendent  had  still  lacked  one  quality — that  of 
enlisting  the  enthusiasm  of  his  department  heads  and 
men.  The  new  superintendent  must  have  magnetism  as 


GETTING  THE   RIGHT   MAN 


S3 


APPLICATION  FOR  EMPLOYMENT 

Pata                           19 

iMHtofga 

Minn 

Oatk  of  hlrrh                                   Nationality                                 Harried  or  jlngli? 

What  public  school  (!id  yon  attend?                                                    When  graduated? 

Whit  high  tchool  did  you  attend?  Whsn  graduated  ? 

what  college  did  you  attend?                                                         When  graduated? 

What  course  did  yon  take?              .                                          Kind  of  work  wanted 

Have  yon  any  physical  defects?                                                 Wages  or  salary  expected 

Give  the  names  of  the  firms  for 
which  you  have  worked,  beginning 
with  the  first  and  naming  the  last 
to  date. 

Kind  of  business 

What  salary  or  wages 
did  you  receive? 

Hame  pf  (aft  employer 

Mdmt 

Why  did  ynn  leave? 

Nam* 

Mdran 

Why  did  you  leave? 

Mama 

Address 

Why  did  you  leave? 

Name 

Address 

Why  did  you  IMVS? 

Nina 

Address 

Why  did  you  leave? 

Navo  you  ever  hem  employed  by  this 
Nave  you  any  relatives  In  the  employ 
If  so,  give  names 

company?                          What  position? 

of  this  company? 

Introduced  to  this  company  by 

REFERENCES 

Name                           II                  Address                   II                  Business 

II                                               I 

Date  assigned                                           Department 

READ  RULES  ON  OTHER  SIDE 

FORM    I:    Specific  questions  and  successive  dates,  used  with  clearness 

and  simplicity,  have  made  this  employment  application  blank  successful 

in  a  large  manufacturing  concern.     This  form  was  adopted  after  it  was 

found  that  workers  objected  to  filling  out  more  lengthy  blanks 


34 SELECTING  AND   HIRING 

well  as  the  desirable  traits  of  the  man  who  was  step- 
ping out. 

Big  cities  were  vainly  searched  for  a  man  of  the  right 
caliber.  One  evening  at  a  public  dinner,  an  official  of 
the  corporation  met  a  factory  man  whose  bearing  and 
conversation  suggested  him  for  the  place.  Studying  his 
face,  form,  voice  and  manner,  the  executive  decided  that 
here  was  the  man  of  balance  and  poise  to  take  over  the 
management  of  the  plant.  Following  up  the  lead  next 
day,  he  found  that  his  new  acquaintance's  record  and 
experience  bore  out  the  first  impressions.  Testing  him 
thoroughly,  he  hired  him,  and  within  three  months  had 
the  gratification  of  seeing  him  "fit  in"  with  decisive 
success. 

Behind  the  selections  made  by  these  employment  offi- 
cials lies  a  principle  in  the  handling  of  men  which, 
properly  developed,  is  enabling  employers  to  choose 
workers  with  something  like  certainty.  By  years  of 
study,  the  sales  manager  had  standardized  the  require- 
ments of  his  field  and  the  inner  significance  of  men's 
outward  characteristics.  The  official  who  determined  in 
an  hour  across  a  dinner  table  that  a  well-groomed  neigh- 
bor could  fill  a  $25,000  position,  was  guided  by  more 
scientific  standards  as  to  human  traits  and  their  outward 
evidence.  In  both  instances,  keen  study  had  set  down 
specifications  for  the  position  and  interpreted  the  lan- 
guage which  a  man's  life  writes  upon  his  hands,  into  his 
penmanship,  upon  his  face  and  form,  in  his  words  and 
actions. 

With  a  third  employer,  mere  repetition — recognition 
of  the  average  which  stands  out  from  judging  one  type 
of  employee  for  only  two  or  three  kinds  of  work  thou- 
sands of  times,  brings  the  same  result.  He  is  expert  in 
deciding  between  girls  of  the  nervous  type  and  steady 


GETTING  THE  RIGHT   MAN 35 

workers  who  settle  down  when  the  rush  hour  comes  and 
handle  the  work  point  by  point  regardless  of  how  fast 
it  pours  in. 

Standardization — this  knowledge  of  the  average  both 
in  jobs  and  in  men — is  essential  to  accurate  hiring  of 
help.  Personal  error  always  figures  in  any  one  man's 
idea  of  what  a  position  requires,  and  where  the  manager 
is  out  of  touch  with  his  departments  or  the  merchant 
believes  that  making  change  is  the  chief  mission  of  the 
worker  behind  a  counter,  this  error  will  be  costly.  An- 
other error  always  discounts  a  man's  judgment  of  his 
own  or  another's  ability.  Several  definite,  easy  and 
practical  ways  have  been  found  to  set  up  standards  that 
guard  against  these  "personal  equations"  in  judging 
positions  and  applicants. 

The  superintendent  of  a  little  factory,  who  had  worked 
out  an  informal  standard  of  ability  for  various  positions, 
had  written  and  advertised  widely  for  a  subordinate  to 
study  and  report  conditions  about  the  plant.  In  his 
letters,  he  gave  a  detailed  description  of  the  man  he  was 
looking  for,  enumerating  the  different  duties  and  quali- 
ties required.  From  a  mass  of  human  material,  he  chose 
a  man  whose  interesting  and  orderly  application,  favor- 
able character,  appearance,  experience  and  willingness 
to  adapt  himself,  seemed  ideal. 

"How  did  this  appeal  to  you?  What  was  your  angle 
on  the  situation?"  were  questions  which  the  employer 
put  to  his  new  inspector  day  after  day  with  regard  to 
factory  problems. 

"Well,  the  foreman  said—" 

"Never  mind  what  others  said — what  were  the  facts? 
What  was  your  conclusion?" 

"Why,  the  men  I  talked  with  laughed  at  the  idea." 

"Yes,  but  what  were  the  facts?" 


36 SELECTING  AND  HIRING 

But  the  answer  was  always  second-hand.  He  took  no 
decided  personal  stand. 

Three  months  later  the  employee  was  asked  to  resign. 
He  and  his  employer  had  both  been  mistaken  in  working 
out  standards  by  which  to  measure  a  man  for  the  in- 
spectorship. He  had  turned  out  to  be  a  collector  of 
interested  opinions,  not  facts. 

Naturally  independent  in  his  own  thinking,  the  super- 
intendent had  felt  a  special  liking  for  the  worker  who 
easily  agreed.  In  checking  over  the  loss  of  the  promis- 
ing apprentice  he  hit  upon  his  error.  One  essential  of 
the  position  he  had  not  realized ;  that  it  required  a  man 
would  could  see  things  through  his  own  eyes,  accept 
information  as  opinion  rather  than  fact,  weigh  points 
independently,  see  conditions  clearly  and  bring  an  outside 
judgment  to  bear  on  the  point  at  issue. 

Going  to  his  files,  the  employer  drew  out  the  duplicate 
letter  in  which  he  had  tersely  put  his  description  of  the 
position  and  to  the  qualifications  there  noted,  added  the 
words,  "Independent  in  judgment." 

The  man  whom  he  next  employed  had  frankly  dis- 
agreed on  several  points  that  came  up  in  the  first  inter- 
view. He  accepted  only  what  he  saw  through  his  own 
eyes.  Hired  by  the  qualifications  his  employer  had 
developed  in  three  months'  study  of  the  work,  he 
proved  to  be  just  the  man  for  the  place. 

A  PL  AN  for   standardizing   requirements  for  every 
position   and   predetermining  the  necessary  quali- 
fications.   How  the  hit-or-miss  element  is  eliminated. 

Standardized  requirements  for  every  position  are  the 
basis  of  one  employment  plan,  to  which  hundreds  of 
office  and  factory  workers  look  for  places,  promotions 
and  recognition  of  efficiency. 


GETTING   THE   RIGHT   MAN 37 

An  employment  committee  with  a  permanent  secretary 
presides  over  the  system.  This  body  first  held  sittings 
and  called  in  different  department  heads  throughout  the 
concern,  in  groups  of  three  or  four.  In  this  way  it  got 
on  paper  the  requirements  of  all  places,  the  value  of  the 
work  done,  the  faults  of  average  workers  and  every  vital 
point  brought  up  by  foremen  or  officials.  "Specifica- 
tions" were  then  informally  drawn  for  all  routine  places; 
and  these  positions  were  arranged  in  definite  grades  to 
determine  rank.  Department  heads  were  often  called 
back  for  a  second  conference.  The  committee  invited 
"house"  criticism  of  the  plan.  Finally,  after  a  search- 
ing comparative  check,  the  whole  scheme  was  put  into 
force. 

Its  immediate  advantages  were  these : 

1.  Department  heads  gained  precise  ideas  as  to  the 
requirements   of   each   worker's   job,   the   output   they 
should  expect  and  get,  and  the  training  they  should  give 
employees. 

2.  Efficiency — a  large  initial  saving  and  fairly  uni- 
form justice  among  employees — replaced  the  haphazard 
inefficiency  which  had  been  clogging  the  man-machine 
during  fifty  years  of  irregular  growth. 

In  this  plan,  provision  is  made  to  keep  the  standard 
up  to  date.  The  employment  committee,  always  in- 
formally in  session,  immediately  considers  and  records 
changed  working  needs.  Vacancies  are  filled  by  promo- 
tion whenever  possible,  the  department  head  in  confer- 
ence with  the  committee  choosing  the  best  man  from 
the  next  lower  grade.  What  each  position  demands  is 
thus  standardized,  put  on  record  and  revised  in  repeated 
consultation.  At  least  two  trained  officials  check  the 
requirements  of  every  place  and  the  capacities  of  every 
man  in  this  great  establishment. 


:38 SELECTING  AND  HIRING 

"When  a  department  head  needs  a  factory  hand,  a 
shipping  clerk,  an  accountant,  a  stenographer  or  a  drafts- 
man," said  the  employment  manager  of  another  concern 
which  has  similarly  standardized  methods  of  handling 
more  than  ten  thousand  workers,  "he  fills  in  this  card 
(page  41)  covering  the  man  who  is  leaving,  and  sends 
it  to  my  department  with  a  requisition  for  the  new  work- 
man. My  assistants  have  been  chosen  for  a  natural 
aptitude  in  handling  men  and  have  personally  studied 
the  requirements  of  most  positions.  The  foreman's 
statement  serves  as  a  further  reminder  and  source  of 
information,  if  the  new  man  is  needed  to  replace  one 
leaving.  Every  ex-employee 's  history  goes  into  our  files, 
so  that  we  have  in  the  department  complete  records  of 
the  men  selected  for  positions,  including  current  reports 
on  such  men  and  final  reports  on  all  former  employees 
or  men  once  refused  as  undesirable.  With  all  this  data 
as  to  the  man  needed,  we  select  the  most  suitable  man 
available  and  send  him  to  the  foreman  to  refuse  or 
approve  (without  absolute  veto)." 

The  merchant  with  two  or  three  clerks  on  his  pay  roll 
and  the  manufacturer  who  employs  but  a  score  of  men, 
are  finding  it  worth  while  to  standardize  their  positions 
by  the  same  principles  and  plans  here  described : 

1.  Put  into  writing  the  qualifications  of  the  position 
as  you  know  it. 

2.  Have  the  men  closest  to  that  work  check  on  your 
specifications. 

3.  Study  similar  work  and  workers  in  other  concerns. 

4.  Check  over  and  adjust  all  positions  in  the  direc- 
tion of  definite  standards. 

5.  With  every  experience  which  shows  you  some  new 
requirement  of  the  position  or  some  chance  to  economize 
by  doing  away  with   what  has  been  considered  a  require- 


GETTING  THE  RIGHT   MAN 3& 

ment,  revise  your  written  estimate  of  the  place  and  its 
duties. 

6.     Consciously  measure  applicants  by  these  standards. 

By  this  simple  routine,  developed  in  both  progressive 
large  and  small  organizations,  the  business  man  handles 
the  hiring  of  men  with  accurate  knowledge  of  the  places 
to  be  filled.  Against  the  haphazard  choice  of  his  neigh- 
bor who  is  merely  "looking  for  a  man,"  he  can  match 
precise  place  specifications  based  on  averages  developed 
in  his  years  of  experience  with  employment  problems 
at  many  desks. 

When  a  skilled  buyer  asks  producers  for  bids  on  his 
needs,  he  does  not  trust  entirely  to  his  personal  choice 
between  values.  Not  only  has  he  standardized  his  de- 
mands, but  he  has  also  worked  out  methods,  tests  and 
comparisons  between  the  various  competing  products  so 
that  before  buying  he  knows  precisely  which  are  his  best 
all-around  investments. 

r  |^tt±i  successful  employer  of  labor  trains  himself  to 
JL    recognize  certain  characteristics  in  men  and  backs 
his  personal  judgment  by  a  law  of  averages. 

Successful  employers  are  equipping  themselves  simi- 
larly for  buying  labor.  Your  personal  estimate  of  an 
applicant,  whether  for  the  vacant  place  behind,  the 
counter  in  a  twenty-foot  shop  or  for  one  of  a  hundred 
positions  in  a  twenty-acre  factory,  need  no  longer  be 
merely  intuitive  or  reiterative.  Your  personal  judgment 
of  capacity  can  have  the  background  of  averages.  To  a 
marked  degree  you  can  train  yourself  by  practicing  the 
interpretation  of  characteristics  which  mark  men  of  vari- 
ous traits  and  types. 

"Work  out  these  ten  problems,"  said  an  employment 
official  of  a  Chicago  factory  to  three  boys  applying  for 


40 SELECTING   AND   HIRING 

work  as  office  beginners.  Twenty  minutes  later,  one  of 
the  boys  handed  in  a  neat  and  fairly  accurate  paper. 
The  second  applicant's  return  represented  nearly  an 
hour's  hard  work.  The  third  boy  furtively  eliminated 
himself,  proving  in  the  least  expensive  way  that  his 
intelligence  was  limited.  Compared  with  the  employ- 
ment man's  standards  or  day-by-day  averages  on  appli- 
cants, the  time  required  to  finish  gave  a  line  on  each 
youngster's  mental  alertness. 

Equally  tell-tale  was  the  manner  of  solving  the  prob- 
lems. The  first  three  questions  were  elementary  and 
the  second  boy,  coming  to  them  with  fresh  enthusiasm, 
solved  them  correctly.  Nor  was  he  caught  napping  when, 
after  figuring  the  fourth  problem  throughout  in  pounds, 
he  was  required  in  the  fifth  to  shift,  reducing  pounds 
and  tons  to  a  common  term.  Of  the  several  ways  to  make 
such  calculations,  however,  his  solution  lacked  the 
originality,  independence  and  directness  which  more 
self-reliant  applicants  often  show. 

Quizzing  the  applicant  as  to  his  experience,  record  and 
ambitions  has  become  a  formality  as  meaningless  as  the 
stock  circular  or  the  form  letter.  One  man  of  wide  ex- 
perience at  the  employment  desk  questions  ' '  whether  one 
in  a  hundred  application  blanks  is  truthfully  and  cor- 
rectly filled  out.  Not  merely  does  the  applicant  often 
intentionally  deceive,  but  more  often  he  leaves  blanks, 
fails  to  understand  what  is  wanted  or  finds  an  easy  way 
to  evade  unfavorable  answers.  In  many  cases,  too,  in- 
telligent and  independent  mechanics  get  out  of  patience 
trying  to  fathom  the  obscure  queries  and  quit  in  dis- 
gust." 

Requests  for  a  list  of  previous  employers,  merely 
as  an  example,  are  often  so  vague  that  the  applicant  can 
begin  and  leave  off  where  he  pleases ;  or  can  fill  the  entire 


GETTING  THE  RIGHT   MAN 


41 


space  with  names  of  transient  employers  and  omit  vital 
facts. 

The  first  step  in  the  routine  of  hiring  a  workman  in 
one  metropolitan  concern  is  to  have  him  fill  out  a  care- 
fully arranged  application  blank,  shown  on  page  33, 
on  which  definite  queries  and  specific  data  appear  as  a 


EX-EMPLOYEE'S  RECORD 

To  Employment  Dent  Ha 

Date 

Last  day  worked 

CM  ML 

Name 

Address 

te*SM  for  luring 

Character  ef  service 

Reinstatement 

Owl  accord 

Good           Fan- 

Unsatisfactory               No  objection 

luvt  of  absent* 

Work 

Do  not  re-employ  for 

Laid  ett 

Conduct 

tbls  department,  for 

Msmlssod 

Ability 

Olscbsrejed 

Class  of  work  performed 

Remarks  (Give  ccmplata  Information  concerning  reason  for  leaving) 

Signed                                                                 Foreman  Dept  No. 

This  coupon  must  be  detached  by  the  foreman  end  sent  at  once  under  cover  to  the 
Employment  Department 

FORM  II:    This  report  card  acts  as  a  check  on  the  employee  who  is  leav- 
ing.    It  gives  the  employment   department  an  up-to-date   glimpse  of  the 
place  to  be  filled,  as  well  as  an  instant  record  should  the  worker  ask  for 
reinstatement  at  any  time 

check  on  the  writer's  attention,  thoroughness  and  ac- 
curacy. An  experienced  man  then  interviews  him.  This 
official  was  himself  chosen  with  these  requirements  in 
view:  (1)  ahility  to  concentrate,  (2)  ability  to  observe 
accurately,  (3)  power  of  analysis,  (4)  capacity  to  re- 
ceive and  remember  many  details,  (5)  resource  in  test- 
ing, checking  and  drawing  conclusions,  (6)  acquaintance 
with  the  requirements  of  the  positions  to  be  filled. 

On  his  desk,  this  official  has  cards  filled  with  data  as 
to  the  standards  fixed  for  the  vacant  positions.     He  has 


42 SELECTING   AND   HIRING 

made  a  detailed  study  of  different  human  types,  char- 
acteristics and  traits,  so  that  he  can  apply  a  mental  tape 
measure  to  the  applicant  on  every  essential  quality. 

In  the  employment  official's  mind,  as  in  that  of  the 
buyer,  the  requirements  which  the  vacancy  makes  upon 
the  applicant  range  in  precise  order,  from  absolute 
qualifications  as  regards  age,  health,  mental  power  and 
physical  strength,  through  the  variables  of  education, 
experience,  wages  wanted  and  practical  aptitudes.  By 
checking  the  points  in  this  order,  the  official  eliminates 
the  impossible  applicant  instantly  and  saves  time  in 
which  to  weigh  more  carefully  applicants  who  are  ' '  run- 
ning close." 

First  comes  eye  judgment  of  the  man ;  then  a  study  of 
the  written  application;  and  finally,  the  personal  inter- 
view, checking  up  the  accuracy  and  completeness  of  the 
written  statements — developing  in  a  subtle  way  the 
temperament,  experience,  aptitudes  and  ambitions  of  the 
workman. 

Many  concerns  require  promising  applicants  to  pass 
a  physical  examination  before  they  are  hired.  Others 
are  attempting  to  interpret  with  certainty  the  character 
labels  of  physical  form,  physiognomy  and  the  like.  Hand- 
writing contains  dozens  of  different  suggestions  working 
towards  an  accurate  impression  of  the  writer.  In  sev- 
eral concerns,  the  handwriting  on  application  blanks  is 
studied  for  these  involuntary  character  labels.  Every 
experienced  employer  has  his  favorite  tests,  sample 
tasks  and  trick  problems  to  develop  the  true  fitness  of  his 
man  for  his  place.  The  psychological  laboratory  fur- 
nishes interesting  tests  in  the  attempt  to  get  away  from 
a  personal  equation  and  standardize  judgment  on  appli- 
cants. Combine  the  best  from  these  various  tests  and 
the  pay  roll  is  relieved  of  a  weight  of  error. 


GETTING  THE   RIGHT   MAN 43 

The  employment  department  of  a  manufacturing  con- 
cern needed  an  assistant.  An  applicant  appeared  at  the 
office  for  the  position.  The  employment  chief  applied 
his  tests — judgment  of  face  and  form — study  of  the 
application  blank — personal  conference.  The  applicant 
was  shrewd,  yet  he  failed  in  a  surprising  way  to  draw 
mature  conclusions.  The  employer  felt  that  there  was 
excellent  material  in  the  man,  if  it  could  be  classified 
and  fitted  into  the  organization.  He  took  the  applicant 
into  his  private  office  and  had  him  work  out  in  great 
detail  a  statement  of  his  previous  positions  and  what  he 
had  there  observed.  To  his  surprise,  his  man  came 
through  with  an  almost  photographic  record.  So  long 
as  only  facts,  not  judgments,  were  in  question,  the  man 
was  unerring.  He  was  appointed  to  inspect  and  report 
on  conditions  in  the  various  branch  houses,  and  is  doing 
good  work. 

The  most  precise  of  employers  are  coming  to  lay  more 
emphasis  also  on  the  worker's  physical  make-up.  One 
chain  of  retail  stores  has  every  likely  applicant  submit 
to  a  thorough  physical  examination,  governed  by  certain 
rules  as  decisive  as  those  of  life  insurance.  This  retail 
organization,  moreover,  keeps  medical  and  surgical  serv- 
ice in  waiting  on  its  employees  at  all  times,  believing  that 
no  man  can  give  value  or  grow  up  to  his  opportunities 
without  health.  Neglect  of  the  cold,  the  headache  or  the 
foot  that  irritates  the  clerk's  temper,  are  subjects  for 
reprimand.  A  great  factory  organization  carries  the 
principle  further  and  requires  physical  examination  of 
all  routine  employees  four  times  every  year. 

In  an  agricultural  implement  factory  capitalized  at 
millions,  the  provisions  for  physical  test  before  employ- 
ment are  as  follows:  All  applicants  after  passing  the 
department  quiz  and  signing  up  for  work,  are  put 


44 SELECTING   AND   HIRING _^ 

through  a  preliminary  examination  for  defects  in  atti- 
tude, sight,  alcoholism  and  other  evident  diseases.  Those 
who  pass  this  test  then  strip  and  are  examined  by  physi- 
cians under  the  shop  rules  as  to  vision,  height,  weight, 
measurements,  past  injuries  and  sicknesses,  and  impor- 
tant tests  or  indications  of  disease.  The  exactness  of 
medical  science  and  health  standards  makes  this  examina- 
tion conclusive. 

HOW  primary  tests  in  hiring  can  be  used  automati- 
cally to  weed  out  the  unfit,  and  largely  determine 
the  degree  of  ability. 

Physical  and  outward  as  this  phase  of  employment  is, 
it  suggests  the  progressive  view  of  the  problem  of  finding 
and  fitting  in  workmen.  Men  are  coming  to  be  con- 
sidered to  a  certain  extent  as  machines — infinitely  deli- 
cate and  adaptable  mechanisms,  but  mechanisms  which 
can  do  their  best  only  when  assigned  to  the  position 
whose  various  requirements,  in  general,  parallel  the 
subtle  machinery  of  their  brain,  nervous  system,  and 
physique. 

One  employment  expert,  who  has  drawn  standard 
specifications  for  judgment  of  men,  first  tests  the  appli- 
cant for  his  more  obvious  characteristics,  his  general 
appearance,  his  most  apparent  traits,  his  facial  expres- 
sion, manner  of  walking,  method  of  standing  or  sitting, 
and  attitude  in  shaking  hands.  By  constant  study,  all 
these  different  points  have  come  to  have  a  standard 
significance  to  the  expert,  just  as  the  red  or  white  or 
blue  card  in  the  index  means  a  definite  thing  to  the  file 
clerk. 

The  careful  man,  for  example,  will  usually  show  his 
precision  in  his  speech,  in  his  walk,  in  his  dress.  His 
courtesy,  his  laziness  or  industry,  his  orderliness,  his 


GETTING  THE  RIGHT  MAN 45 

optimism  and  his  patience  are  tested  by  setting  tasks 
for  him,  by  catching  him  off  his  guard  with  irritating  or 
novel  topics  of  conversation.  The  shrewd  employer  is 
guided  also  by  watching  the  hands  of  the  applicant  as  he 
talks  and  by  reading  his  true  state  of  mind  from  the 
nervous  or  unconscious  movements  of  whatever  parts 
of  his  body  he  forgets  to  control.  The  problem  is  merely 
to  interest  the  applicant,  to  get  beyond  his  reserve,  to 
catch  him  off  guard,  and  then  to  read  him,  knowing 
precisely  the  qualities  that  elect  or  defeat  him. 

Physiognomy  and  physique  often  suggest  a  man's 
characteristics.  Test  questions  make  a  man  concentrate 
and  forget  himself,  giving  a  glimpse  of  how  his  mind 
works.  Expert  study  of  the  hand,  on  which  is  written 
the  applicant's  daily  contact  with  his  work  and  the 
ancestry  of  art  or  artisanship  behind  him,  adds  its  clues 
to  the  character  of  the  applicant. 

Psychology  is  going  even  beyond  these  indications  and 
contriving  actual  tests  of  results  which  men 's  minds  and 
nervous  systems  give.  In  his  laboratory  the  student  of 
nervous  reactions  takes  the  problem  of  the  telephone 
operator,  the  street-car  motorman,  the  clerk,  the  machine 
operator;  and  contrives  a  simple  apparatus  which  will 
reproduce  the  essentials  of  that  task.  He  tests  fifty 
average  employees  and  establishes  a  standard  of  accuracy, 
of  quick  wits,  of  variation  or  originality.  He  tests  fifty 
novices  and  fixes  a  standard  of  off-hand  performance 
which  probably  eliminates  the  one  in  three  or  four  who 
would  be  most  expensive  to  train  and  least  proficient 
in  the  end 

Every  one  of  these  methods  which  hundreds  of  differ- 
ent employers  are  working  out  piecemeal,  is  focusing  on 
one  ideal — a  standard  by  which  to  grade  the  man  for  the 
job — a  yardstick  by  which  to  determine  the  applicant 


46 SELECTING  AND  HIRING 

who  most  nearly  fits  a  place  of  definite  dimensions  and 
requirements. 

With  the  suggestion  of  these  many  different  clues  and 
bases  of  judgment  before  him,  the  employer  of  one  or  a 
dozen  workers  in  store,  office  or  factory,  can  set  down 
his  list  of  essential,  standard  qualifications  for  various 
positions.  Thus  to  the  saving  of  misfit  effort  and  the 
accidents  it  brings  in  its  train,  you  can  help  your  appli- 
cant work  out  the  absolute  answer  to  the  three  vital 
questions  of  help  hiring: 

Is  this  man  the  best  man  for  this  place  * 

What  can  he  do  best  ? 

What  can  he  develop  into  ? 


THOSE  who,  in  the  golden  age  of  art,  painted  or  carted 
or  wrote  beautiful  things,  did  so  primarily  for  the  love 
of  art  itself.  So  may  I  not  assert  that  if  in  an  age  of  industry 
a  man  devotes  himself  to  industry  for  industry's  sake,  he  is 
following  the  same  artistic  instinct  of  trying  to  do  a,  fine  act 
simply  because  it  is  fine?  A  business  must  be  profitable  if  it 
is  to  continue  to  exist,  but  the  glory  of  business  is  to  make 
it  so  successful  that  you  can  do  great  things  because  they  are 
great  and  because  they  ought  to  be  done. 

CHARLES  M.  SCHWAB, 
Chairman  of  the  Board  of  Directors,  Bethlehem  Steel  Corporation 


WHY  WE  ARE  REPLACING 
MEN  WITH  WOMEN 

An  Interview  with  Will  I.  Ommer, 
President,  Recording  and  Computing  Machines  Company 

WITH  their  deft  fingers  and  willing  minds,  women 
workers  are  taking  the  positions  formerly  held 
by  men  in  practically  all  parts  of  our  factory.  The 
women  are  proving  specially  effective  on  the  lighter 
machines  and  on  assembly  work,  where  dexterity  rather 
than  strength  is  the  necessary  qualification. 

One  instance  in  our  recent  experience  will  indicate 
the  quantity  of  work  which  women  are  turning  out  as 
compared  with  the  former  output  of  the  men.  For  some 
time  the  men  on  our  turret  lathes  who  were  turning  out 
standard  pieces  had  been  able  to  average  only  190  pieces 
a  day.  By  time  studies  we  decided  it  was  possible  for 
them  to  do  about  375  pieces.  We  set  this  standard  and 
the  men  were  able  to  attain  it.  Not  long  after  this,  we 
found  it  advisable  to  employ  girls  to  work  on  these 
turret  lathes.  They  were  first  put  through  a  thorough 
course  of  training  and  now  are  regularly  turning  out  an 
average  of  315  pieces  daily  on  each  lathe. 

Of  course,  in  order  to  obtain  results  of  this  sort,  we 
have  found  it  necessary  to  offer  inducements.  We  are 
paying  the  women  in  our  factory  exactly  the  same  rate 
of  wages  as  the  men.  Many  of  them  are  getting  from 
six  to  eight  dollars  a  day.  This,  of  course,  is  paid  to 
them  in  the  form  of  a  standard  wage  plus  a  bonus.  If 


48 SELECTING   AND   HIRING 

you  could  step  into  almost  any  of  our  departments,  I  am 
sure  you  would  be  impressed  by  the  beehive  industry  of 
the  place.  In  many  cases  the  girls  are  actually  so  busy 
that  they  do  not  like  to  stop  their  work  long  enough  to 
enter  into  any  conversation  even  with  their  foremen. 

Not  long  ago,  the  superintendent  of  the  factory  inves- 
tigated the  tools  on  one  of  our  jobs  where  some  of  our 
most  expert  women  operators  were  working  busily.  His 
investigation  was  of  such  a  nature  it  required  about 
one-half  hour,  and  made  it  necessary  for  one  of  the 
expert  girl  operators  to  stop  work.  After  waiting  about 
ten  minutes,  she  became  very  much  excited  and  said: 
"See  here,  my  dear  man,  I  have  to  get  out  500  pieces 
each  day,  and  if  I  am  interrupted  like  this,  I  can't  do 
it.  Please  let  me  alone  and  let  me  get  to  work. "  This  is 
perhaps  characteristic  of  the  attitude  of  all  our  women 
workers. 

However,  in  spite  of  the  amount  of  work  they  do,  they 
are  not  overworked.  In  fact,  they  seem  able  to  keep 
up  their  high  rate  of  speed  better  than  the  men.  In 
one  of  the  assembly  departments,  for  instance,  we  tried 
men  upon  a  particularly  trying  job,  and  at  the  end  of 
three  days,  they  came  to  us  and  told  us  that  the  work 
was  too  strenuous.  "We  put  girls  at  the  benches  and 
there  has  not  been  any  complaint. 

We  have  rest  rooms  and  a  hospital  where  any  of  the 
women  can  go  at  any  time  during  the  day.  "We  also  have 
two  rest  periods,  one  in  the  morning  and  one  in  the 
afternoon,  each  ten  minutes  in  length.  I  urge  the 
women  to  rest  during  these  periods  and  also  to  make 
as  free  use  of  the  rest  room  and  hospital  facilities  as 
they  like.  Recently  I  was  walking  through  the  plant 
and  I  noticed  one  of  the  girls  leaning  her  head  on  the 
back  of  her  chair.  I  asked  her  what  the  trouble  was 


REPLACING   MEN   WITH   WOMEN  49 

and  she  said  she  had  a  slight  headache.  I  told  her  to 
go  to  the  hospital;  but  she  refused.  She  was  one  in 
a  group  of  workers  who  were  doing  assembly  work  and 
she  felt  that  if  she  dropped  out,  she  would  make  it 
impossible  for  the  group  to  take  care  of  the  entire  out- 
put planned  for  the  day. 

''•"'HE  girl  workers  are  thoroughly  trained  in  a  "school" 
A    before  they  undertake  actual  work  and  are  paid 
wages  equal  to  those  received  by  male  employees. 

I  am  glad,  however,  when  the  girls  do  take  advantage 
of  the  facilities  we  offer  them.  And  when  they  do  so, 
they  can  often  cure  at  once  their  slight  indisposition, 
whereas  if  they  went  on  working  when  they  were  not  in 
a  condition  to  do  so,  they  might  overexert  themselves. 

In  order  to  fit  the  girls  for  the  various  kinds  of  work 
which  we  expect  them  to  do,  we  have  a  school  with  six 
women  teachers.  All  new  girls  are  required  to  attend 
this  until  they  are  able  to  perform  the  work  on  which 
we  expect  to  place  them.  Usually  this  takes  about  three 
days.  At  the  end  of  that  time,  they  have  had  practice 
in  exactly  the  kind  of  work  that  we  expect  them  to  do 
and  they  are  not  embarrassed  or  nervous  when  they  are 
put  out  in  the  shop  to  do  actual  work.  At  one  end  of 
the  room  where  we  have  the  school,  we  have  a  big  placard 
bearing  these  words  ' '  Girls,  ask  questions. ' '  Most  of  the 
girls  follow  this  advice  and  it  is  surprising  how  quickly 
they  learn  the  various  phases  of  the  work. 

In  addition  to  paying  the  girls  on  a  bonus  plan,  the 
same  as  men, — by  the  way,  I  should  mention  the  fact 
that  we  guarantee  that  the  bonus  once  it  is  established 
will  never  be  cut — we  find  it  helpful  to  stimulate  a 
friendly  competition  in  order  to  get  out  the  quantity 
of  work  which  we  think  is  proper  as  a  regular  schedule. 


50 SELECTING   AND   HIRING 

One  of  the  methods  which  we  find  particularly  effective, 
for  instance,  is  what  we  call  our  barometer  of  pro- 
duction. 

The  barometer  is  merely  a  long  sheet  of  cardboard,  on 
which  are  drawn  the  outlines  of  six  glass  tubes  such  as 
are  used  in  thermometers.  Where  there  are  four  or  five 
or  six  groups  of  women  working  together  on  a  group 
bonus  plan,  we  place  one  of  these  cardboard  barometers 
in  a  position  where  all  the  workers  can  see  it.  Daily 
we  draw  in,  in  colors,  the  amount  of  work  which  each 
of  the  groups  has  done  to  date.  If  group  A,  for  instance, 
has  finished  18,000  pieces  to  date  in  the  current  month, 
whereas  groups  B  and  C  have  done  only  14,000,  it  is 
obvious  that  groups  B  and  C  are  anxious  to  bring  their 
record  up  to  correspond  with  A's.  The  girls  do  take 
a  lot  of  interest  in  these  barometers.  They  study  them 
each  day  and  there  is  a  lot  of  competition  between  the 
groups. 

Where  the  girls  are  working  individually,  we  use 
blackboards  to  show  who  is  producing  the  high  record 
for  the  current  day.  Perhaps  at  three  o'clock  the  girl 
at  machine  No.  47  has  turned  out  900  pieces,  whereas 
most  of  the  other  girls  have  only  done  somewhere  around 
750.  We  put  the  high  girl's  record  on  the  board  where 
everybody  can  see  it  and  this  furnishes  a  direct  incen- 
tive for  the  others  to  bring  up  their  output  as  far  as 
possible.  Then  in  the  office  we  have  complete  individual 
records  of  the  output  of  every  one  of  our  eight  thousand 
employees  daily. 

At  this  point  it  might  be  well  for  me  to  say  that  the 
quality  of  our  work  has  in  no  way  been  permitted  to 
go  down  as  the  quantity  goes  up.  We  have  inspection  at 
every  step  in  production,  so  if  an  error  is  made  in  the 
first  step,  the  product  does  not  go  through  all  the  other 


REPLACING    MEN   WITH   WOMEN 51 

steps  before  the  mistake  is  caught.  Our  experience  has 
taught  us  that  women  workers  seem  to  require  different 
handling  than  the  men.  At  first,  we  had  a  certain  amount 
of  difficulty  with  some  of  our  foremen  who  were  trained 
in  handling  men.  They  did  not  understand  the  women 
and  tried  to  manage  them  in  the  same  way  that  they  had 
managed  men.  Gradually  cases  of  this  sort  have  been 
almost  eliminated. 

Our  factory  workers  are,  if  I  may  say  it,  like  a  happy 
family.  All  the  girls  know  me  and  I  know  a  great  many 
of  them  by  name.  I  want  them  to  feel  at  home  with  me. 
The  greatest  pleasure  I  have  is  going  among  them  seeing 
they  are  happy  at  their  work,  and  discussing  any  little 
problem  with  them  that  may  come  up. 

Any  worker  has  the  privilege  to  come  to  my  office 
with  any  problem  she  may  have  at  any  time  of  the  day. 
They  do  come,  quite  a  good  many  of  them,  but  they  are 
very  fair  about  the  privilege  and  they  have  never  abused 
it.  I  make  it  a  point  when  there  is  any  question  of  dis- 
cipline brought  up,  to  have  all  of  the  persons  concerned 
brought  into  my  office  at  the  same  time.  There  we  thresh 
the  thing  out  from  start  to  finish,  find  out  who  is  right 
and  who  is  wrong,  and  settle  the  matter  once  and  for  all. 

I  feel  that  it  is  my  personal  duty  to  help  employees 
wherever  I  can.  Not  long  ago  I  heard  indirectly  about 
one  woman  who  was  working  for  us.  She  had  several 
children  and  her  husband  was  paralyzed.  I  saw  the  best 
thing  I  could  do  for  her  was  to  give  her  a  better  class 
of  work,  which  I  did.  I  could  name  quite  a  few  other 
cases  of  this  sort  or  of  a  similar  character.  I  like  to  do 
these  things — besides  having  our  loyal  workers  feel  that 
they  are  working  in  an  organization  where  the  human 
element  is  not  allowed  to  die  out  in  favor  of  making  the 
whole  factory  a  mere  machine. 


52 SELECTING  AND   HIRING 

All  sorts  of  cases  come  up.  Not  long  ago  one  of  our 
men  employees  came  to  me  to  complain  about  the  fore- 
man in  one  of  the  departments  where  his  wife  happened 
to  be  working.  The  man  was  jealous.  Prom  his  machine 
he  could  look  across  into  the  department  where  his  wife 
was  working.  The  nature  of  the  foreman's  work,  which 
was  inspection,  required  that  he  get  close  to  the 
machines  of  the  workers  and  the  man  imagined  that  his 
wife  was  flirting  with  the  foreman.  I  brought  all  three 
into  my  office,  had  a  plain  talk  with  them  and  settled 
the  matter  then  and  there.  In  order  to  avoid  any  pos- 
sibility of  clash  in  the  future,  I  transferred  the  woman 
to  another  department  and  her  husband  is  now  appar- 
ently quite  satisfied. 

WAYS  to  keep  girls  interested  in  their  work.     How 
a  style  show  for  women  workers,  with  gowns  offered 
as  prizes  for  excellent  work,  increased  output. 

We  have  various  methods  of  keeping  up  the  interest  of 
the  employees.  We  have  a  large  dining  room  which 
seats  1,500  people.  We  serve  an  excellent  lunch  at  a  flat 
rate  of  twenty  cents  a  person.  Often  we  move  the  tables 
and  have  informal  dances  in  which  many  of  the  workers 
take  part.  Not  long  ago  we  had  a  style  show  which 
was  of  direct  interest  to  most  of  the  women.  One  of  the 
large  eastern  merchandisers  sent  on  some  of  his  profes- 
sional models  and  we  selected  a  half  dozen  or  so  of  the 
women  from  our  own  organization  to  serve  also  as 
models.  The  gowns  were  offered  as  prizes  for  excellent 
work.  In  this  particular  case,  the  effect  was  so  direct 
and  immediate  that  the  output  increased  100,000  pieces 
in  two  weeks.  The  girls  showed  themselves  what  they 
could  do  when  they  needed  to,  and  since  that  time  the 
production  has  never  fallen  below  these  records. 


REPLACING   MEN   WITH   WOMEN 58 

In  our  dining  room  we  have  an  orchestra  of  fifty-two 
pieces  which  is  made  up  among  our  employees  and  it 
plays  every  day  during  the  noon  hour.  In  addition  to 
this  dining  room,  we  have  a  cafeteria  where  the  em- 
ployees may  select  any  food  they  like  and  pay  as  much 
or  as  little  as  they  wish  for  their  lunch.  In  both  the 
dining  room  and  the  cafeteria  all  the  food  is  home  cooked 
so  that  we  can  be  sure  of  its  wholesomeness.  We  serve 
the  food  at  a  little  below  cost  and  everything  is  kept 
perfectly  clean  and  sanitary. 

One  other  thing  we  are  doing  to  keep  the  interest  of 
our  employees  is  to  sell  them  certain  articles  at  cost. 
Perhaps  some  manufacturers  do  not  agree  with  us  on 
the  wisdom  of  this  policy  and  we  have  had  kicks  from 
merchants  against  what  we  are  doing,  but  I  will  cite 
some  specific  instances  where  we  have  saved  our  em- 
ployees money  by  making  quantity  purchases  and  resell- 
ing the  articles  to  our  employees  at  cost.  This  practice 
has  certainly  made  a  hit  with  our  employees  because 
it  enables  them  greatly  to  lessen  the  cost  of  living. 

For  instance,  we  recently  bought  a  large  number  of 
sweaters  at  prices  ranging  from  thirty-eight  cents  to 
eight  dollars.  Many  of  the  girls  and  men  wear  these 
sweaters  while  they  are  at  work  and  they  appreciated 
the  opportunity  to  buy  them  from  us  at  the  prices  we 
paid  for  them.  Among  these  sweaters  were  some  which 
we  sold  at  eight  dollars  of  exactly  the  same  quality  that 
I  had  paid  sixteen  dollars  for  at  one  of  the  stores  in 
Dayton.  Again,  not  long  ago  we  bought  three  carloads 
of  potatoes  and  resold  them  to  our  employees  at  one 
dollar  and  sixty  cents  a  bushel,  whereas  the  retail  price 
at  most  stores  was  over  a  dollar  above  that.  We  have 
a  special  brand  of  coffee  made  up  for  us  which  costs  us 
nineteen  and  a  half  cents  and  which  we  sell  to  our 


54 SELECTING   AND   HIRING a 

employees  for  twenty  cents.  The  same  grade  of  coffee 
can  only  be  bought  elsewhere  at  from  thirty-eight  to 
forty  cents.  Recently  we  bought  a  carload  of  grapes  and 
had  no  difficulty  whatever  in  disposing  of  the  entire 
lot  at  a  price  considerably  under  the  market. 

RESULTS   some   of  the   methods   described  in  this 
chapter  have  accomplished  both  in  improved  morale 
and  increased  production. 

All  of  these  methods  have  helped  us  materially  to  win 
the  good  will  of  our  women  workers.  The  women,  we 
find,  are  absolutely  loyal.  They  do  not  work  for  us  a 
while  and  then  quit,  which  is  sometimes  urged  as  one  of 
the  objections  against  woman  workers.  In  fact,  girls 
insist  on  staying  with  us.  Not  long  ago  one  of  the  fore- 
men was  telling  me  about  a  girl  whom  he  wanted  to 
discharge.  She  told  him  that  she  couldn't  quit,  that  she 
needed  the  position  and  was  going  to  stay.  I  believe 
we  found  a  way  out  of  the  difficulty  and  kept  her. 
Again,  the  girls  never  show  any  desire  to  follow  the 
hands  of  the  clock  and  jump  into  their  hats  and  coats  at 
5 : 25.  They  work  until  the  last  minute,  eager  to  clean 
up  the  day's  stint  and  make  records. 

Under  our  present  conditions  we  are  having  no  diffi- 
culty whatsoever  in  getting  enough  employees.  As  a 
matter  of  fact,  we  have  been  receiving  applications  at 
the  rate  of  three  thousand  a  week.  We  rented  an  office 
downtown  some  little  time  ago  so  the  women  would  not 
have  to  come  out  to  the  shop  to  see  us  about  employ- 
ment. This  office  proved  a  failure,  however,  after  a 
short  time.  The  landlord  had  to  turn  us  out  because 
there  were  so  many  women  coming  to  the  office  that  the 
elevators  couldn't  take  care  of  them.  And  we  get  a 
high  grade  of  girls,  too.  For  instance,  we  have  working 


REPLACING   MEN   WITH   WOMEN 55 

for  us  now  one  hundred  and  forty  women  who  gave  up 
positions  as  school  teachers  to  come  to  us.  The  wages 
are  attractive  enough  to  enable  us  to  secure  the  best 
grade  of  women  workers. 

Of  course,  one  important  factor  in  getting  the  full 
quantity  of  work  turned  out  is  the  organization  of  the 
work  in  such  a  way  that  it  is  "  always  coming. ' '  At  our 
assembly  tables,  for  instance,  the  work  proceeds  from 
one  end  to  the  other  and  no  one  can  loaf  or  slow  up 
without  everybody  else  knowing  it.  The  work  imme- 
diately accumulates  at  the  place  where  the  worker  is 
slowing  up. 

It  is  interesting,  however,  as  indicative  of  the  spirit 
in  our  organization,  that  when  the  work  does  slow  up, 
the  girls  do  not  turn  on  the  slow  one  and  try  to  have 
her  taken  away  from  their  group.  On  the  contrary,  they 
help  her  out  as  far  as  possible,  try  to  show  her  how  to 
do  her  work  faster  if  she  lacks  the  training,  encourage 
her  and  help  her  if  she  is  not  feeling  well,  and  in  all 
ways  try  to  realize  that  if  they  all  help,  she  will  prob- 
ably be  doing  her  full  share  in  a  short  time. 

At  the  first  the  men  resented  somewhat  the  employ- 
ment of  women  workers.  We  still  have  quite  a  few  men 
at  various  places  in  the  factory  and  in  a  good  many 
places  they  are  doing  the  same  work  as  the  women. 
The  first  resentment  quickly  passed  when  the  men  saw 
that  the  women  were  outdoing  them  and  they  imme- 
diately found  they  must  speed  up  themselves  if  they 
were  going  to  keep  up  the  pace.  Men  and  women  are 
working  side  by  side  in  several  departments  and  it  is 
almost  uniformly  our  experience  that  where  the  work 
is  of  a  kind  requiring  deftness,  a  quick  hand  and  a  quick 
eye,  and  no  waste  motion,  the  girls  are  able  to  handle 
the  work  better  than  the  men. 


56 SELECTING   AND   HIRING 

We  feel  that  we  have  made  a  thorough  test  so  far  as 
our  own  work  is  concerned  and  the  results  are  more 
than  satisfactory.  The  work,  too,  is  of  a  character 
requiring  extremely  close  attention.  A  group  of 
engineers  some  time  ago  told  us  that  the  total  daily  out- 
put we  could  expect  from  our  plant  would  be  around 
4,500  pieces.  Now,  with  the  women  workers,  we  are 
turning  out  from  37,000  to  40,000  pieces  every  day. 
With  men  workers  alone,  I  am  convinced  we  would  not 
have  been  able  to  accomplish  anything  to  compare. 


EP  your  men  know  that  you  work  harder  than  they  do. 
If  you  expect  to  get  any  real  work  done — be  there  your- 
self. As  a  business  grows,  the  head  executive  is  entitled 
to  more  leeway,  but  in  a  little  business  the  boss  should  always 
be  around.  When  the  business  does  grow  and  detail  after 
detail  is  delegated,  make  sure  that  whoever  takes  over  the 
duties  which  you  -performed,  or  any  part  of  them,  is  also 
always  about.  You  will  never  have  the  right  team  work 
unless  each  man  is  looking  after  all  of  his  own  job — and  all 
the  others  know  that  he  is. 

JOHN  NORTH  WILLYS, 

President  of  The  Willys-Overland  Company 


PART  II-HOW  TO  HOLD 
YOUR  MEN 

Putting'  Trust  in  Workers 

A  MAN  will  be  happier  in  his  work  if  he  knows 
•*"'  that  he  is  a  real  part  of  the  concern,  if  he 
knows  that  he  can  spend  all  his  working  days 
with  you  without  danger  of  an  overnight  dis- 
charge. We  believe  that  our  men  deserve 
something  from  us  over  and  above  the  wages  we 
pay  them,  and  that  something  is  our  own  per- 
sonal affection  and  interest.  In  return  we  get 
loyalty  and  good  work. 

The  whole  thought  of  our  establishment,  and 
the  reason  that  we  gain  such  extraordinary 
loyalty,  is  that  we  work  with  our  men  and  they 
work  with  us.  There  is  no  gulf  between  the  shop 
and  the  counting  room.  We  expect  the  men  to 
come  to  us  with  their  troubles,  and  they  come  as 
friends.  We  know  them  and  they  know  us. 

Are  not  some  of  the  so-called  efficiency  meth- 
ods in  handling  workmen  merely  an  attempt 
to  substitute  rule  for  understanding — to  get  a 
human  machine  because  the  employer  does  not 
know  how  to  get  a  fellow  workman? 

We  put  our  chief  trust  in  men;  they  know  it — 
and  make  good. 


FRANK  DISSTOX 

President  of  Henri/  Di.tftton  &  »S'o».y,   Incorporated 


VI 

THE  KNACK  OF  HOLDING 
YOUR  MEN 


By  Henry  L.  Willard, 
President  of  the  Brooklyn  Traffic  Club 


MEN  will  not  work  for  wages;  for  a  certain  sum 
per  day  they  will  go  through  movements,  but, 
when  only  wages  are  concerned,  men  will  not  really 
work. 

Men  will  work  only  for  men.  I  care  not  what  system 
of  efficiency  is  employed  or  what  mechanical  refinements 
are  used,  the  labor  return  will  be  inadequate  so  long  as 
the  personal  equation  is  neglected.  This  abstract  state- 
ment is  nearly  a  truism,  but  few  employers  of  labor 
concretely  realize  its  truth,  and  too  few  of  them  put  it 
into  practice  despite  the  fact  that  it  might  help  them 
a  great  deal. 

Some  years  ago,  I  was  brought  into  contact  with  two 
trainmasters  on  an  eastern  railroad;  they  occupied  the 
same  office — each  had  the  side  of  a  big  flat-top  desk. 
One  was  then  in  charge  of  the  passenger  business  and 
the  other  directed  the  freight  traffic.  I  had  a  chance  to 
observe  their  methods  from  day  to  day.  The  freight 
master  knew  every  man  under  him  by  his  first  name; 
he  knew  something  about  every  family,  and  he  usually 
managed  to  get  around  to  the  house  or  hospital  when 
one  of  his  men  was  injured.  The  passenger  master 
regarded  his  men  as  machines;  he  bellowed  orders,  he 
kept  the  office  in  endless  confusion  and  he  took  par- 


60 HOLDING   MEN 

ticular  pleasure  in  "calling  down"  men  before  the 
other  employees. 

The  freight  trains  moved  smoothly,  the  men  were 
happy  and  interested — they  would  work  overtime  with- 
out complaint.  The  passenger  trains  were  always  late, 
the  trainmen  were  always  grumbling,  and  the  way  in 
which  they  referred  to  their  boss  could  not  be  decently 
put  into  type.  They  were  rude  to  each  other  and  to 
passengers;  they  did  the  smallest  amount  of  work  they 
could  do. 

Today  the  freight  master  is  the  president  of  a  great 
railroad  because  "he  gets  so  much  out  of  men" — he 
changed  a  two-million-dollar  deficit  into  a  surplus  within 
a  year.  He  can  not  now  know  all  his  employees,  but  he 
never  misses  a  chance  to  know  those  with  whom  he  comes 
into  contact.  The  passenger-traffic  master  is  a  conductor 
on  a  suburban  passenger  train,  waiting  to  be  placed 
on  the  pension  roll.  The  first  man  got  results  because 
he  employed  men;  the  second  man  failed  because  he 
considered  his  employees  merely  as  units — inanimate 
parts. 

I  have  studied  the  systems  of  many  employers,  rang- 
ing from  individuals  with  but  a  helper  or  two  up  to  the 
great  corporations  with  their  thousands,  and  I  have  yet 
to  find  an  efficient,  satisfied  working  force  in  which  the 
fact  that  employees  are  men  is  neglected.  I  find  that 
men  do  not  work  in  the  interest  of  their  employer  unless 
they  are  happy  about  their  tasks.  Such  happiness 
springs  from  the  bond  uniting  the  employer  and  em- 
ployee and  this  bond  is  founded  upon  personal  relations. 

It  is  lack  of  interest  that  makes  the  floater  and  the 
floater  is  responsible  for  the  large  labor  turnover.  I 
find  that  the  most  satisfactory  way  to  manage  employees 
and  to  keep  them  constantly  happy,  and  therefore  to  get 


KEEPING   YOUR    MEN  LONGER 61 

a  full  dollar's  worth,  out  of  them,  is  to:  (1)  maintain 
personal  relations;  (2)  put  all  possible  responsibility  on 
the  employee;  (3)  suggest  rather  than  order;  (4)  ad- 
vance by  merit. 

WHY  maintaining  a  friendly  personal  contact  with 
employees  is  vital  to  every  employer,  no  matter 
how  large  or  how  small  his  business  may  be. 

These  four  elements  run  through  every  successful 
employment  relation  that  I  have  thus  far  discovered. 
The  exact  mechanism  by  which  they  are  expressed  de- 
pends largely  upon  the  size  of  the  business.  But  whether 
you  have  one  or  twenty  thousand  employees,  it  is  these 
principles  which  keep  the  man  on  his  job.  Take  the 
big  corporations  whose  employees  are  noted  for  their 
loyalty — such  as  The  Pennsylvania  Railroad,  The  Stand- 
ard Oil  Company,  The  United  States  Steel  Corporation, 
and  you  will  discover  that  the  employees  have  a  per- 
sonal bond  with  the  corporation.  So-called  soulless  cor- 
porations are  merely  poorly  managed  corporations. 

I  remember  being  with  one  of  the  minor  superin- 
tendents of  a  very  large  concern  when  the  president 
happened  by.  The  main  office  of  the  concern  was  in 
another  state,  and  to  the  best  of  the  superintendent's 
knowledge  the  president  had  never  seen  him,  and  yet,  as 
he  passed  through,  the  president  stopped,  said,  "Hello, 
Mac,"  and  shook  hands  with  my  friend. 

The  superintendent  was  vastly  pleased  and  more  com- 
plimented than  he  would  have  been  by  a  formal  resolu- 
tion of  praise  from  the  Board  of  Directors.  "How  in 
the  world  did  he  know  my  name?"  he  marveled — at 
once  he  felt  himself  a  real  part  of  the  organization.  I 
found  out  later  that  this  president,  who  is  a  very  suc- 
cessful manager,  keeps  very  close  tab  on  the  records  of 


62  HOLDING    MEN 


every  worker  in  his  employ,  and  when  he  visits  a  branch 
he  feels  that  he  knows  his  men,  even  though  he  has  never 
seen  them. 

It  is  easily  possible  for  the  employer  of  fifty  or  one 
hundred  men  to  maintain  the  "big  family"  idea,  to  talk 
with  his  men  occasionally  in  a  friendly  way,  take  interest 
in  their  families,  and  to  remember  them  when  they  are 
sick.  In  the  shops  of  a  few  generations  ago  the  labor 
turnover  was  very  small ;  employees  were  satisfied  with 
their  jobs  because  they  felt  that  they  were  working  with 
their  employers.  It  is  not  merely  the  increase  in  the 
labor  turnover  which  is  reduced  by  the  employee's  in- 
terest in  his  work — his  output  is  enlarged,  and  some- 
times he  will  "get  by"  with  extraordinary  work  at 
which  the  shirker  will  throw  up  his  hands. 

I  recall  a  lathe  operator  in  a  very  old  shipbuilding 
company.  He  had  "served  his  time"  with  the  concern 
when  it  was  a  small  affair ;  the  founders  and  he  had  been 
on  a  first-name  basis.  In  the  course  of  years  he  came 
into  charge  of  a  very  large  lathe  used  for  the  heaviest 
work.  When  installed  it  was  the  best  of  its  kind.  Pat- 
terson, as  I  shall  call  him,  grew  up  with  that  lathe — 
he  almost  became  a  part  of  it.  In  every  modern  system 
of  efficiency  the  lathe  should  have  been  discarded,  but, 
although  new  lathes  came  in,  Patterson  always  kept  the 
volume  and  accuracy  of  his  output  above  that  of  the 
new  ones.  No  other  person  in  the  plant  could  manage 
that  lathe;  fresh  superintendents  always  reported  that 
it  should  be  scrapped ;  Patterson  regularly  challenged 
them  to  produce  a  better  one.  "When  that  lathe  goes, 
I  go,"  he  always  finished.  Why  or  how  he  operated  it 
will  remain  a  mystery,  but  he  kept  his  companion  lathe 
until  his  death,  and  letting  him  have  it  was  not  merely 
a  matter  of  humoring  him — he  delivered  the  goods. 


__  KEEPING  YOUR  MEN  LONGER  _  63 

This  is  hardly  a  typical  instance,  and  one  scarcely  to 
be  recommended  as  an  example  of  shop  management, 
but  it  goes  to  show  what  the  employee's  fellow  feeling 
may  mean  to  the  employer. 

As  the  number  of  men  on  the  payroll  increases,  the 
head  of  the  concern  can  not  possibly  know  all  his  men  ; 
he  can  not  spare  the  time  to  even  attempt  so  to  do. 
Division  of  authority  is  necessary.  But  each  foreman 
and  superintendent  can  carry  out  the  same  scheme  of 
man  control,  if  the  stimulus  comes  from  the  top.  The 
men  below  will  reflect  the  attitude  of  the  man  at  the 
top. 


ECK  of  consideration  toward    employees  may   lead 
to  serious  loss.     This  fact  was  an  influence  in  the 
failure  of  one  railroad. 

A  large  eastern  railway  was  headed  by  a  very  efficient, 
but  extremely  pompous,  individual;  when  he  visited  a 
subordinate,  he  stalked  through  the  outer  office  wearing 
a  high  hat  and  looking  neither  to  the  right  nor  the  left  ; 
he  might  have  been  in  the  midst  of  the  desert  of  Sahara 
for  all  the  people  he  seemed  to  see.  What  was  the 
result?  The  same  manner  of  treatment  went  all  the 
way  down  the  line.  The  vice-presidents  bullied  the 
superintendents,  the  superintendents  bullied  the  man- 
agers, and,  finally,  the  employees  bullied  the  public. 
The  railroad  was  nationally  noted  for  its  discourtesy; 
legislatures  hampered  it  ;  and  it  was  in  a  continual  state 
of  investigation. 

The  road  became  bankrupt  —  although  it  did  not  go 
into  the  hands  of  a  receiver.  A  new  president  came  in. 
In  addition  to  railroad  knowledge,  he  knew  men;  he 
never  passed  an  employee  without  bowing  ;  he  never  gave 
a  peremptory  order  ;  when  he  entered  an  office  he  always 


64  HOLDING   MEN 


smiled  and  nodded  to  the  clerks.  Today  that  system 
is  going  forward.  The  public  is  treated  decently  and 
the  turnover  of  labor,  instead  of  being  above  fifty  per 
cent,  is  below  twenty. 

The  principle  of  subdivision  of  control  which  I  advo- 
cate is  founded  on  the  personal  magnetism  of  the  man 
immediately  in  charge.  The  force  directly  under  any 
one  man  should  never  be  too  large  for  the  man  to  main- 
tain personal  relations.  Some  exceptional  captains  will 
manage  a  hundred  men  efficiently  and  others  will  man- 
age only  twenty-five.  In  general,  I  find  that  in  the 
average  organization  fifty  men  is  a  safe  limit  to  the  force 
to  place  under  any  individual. 

Closely  connected  with  the  personal  relation,  and  one 
of  the  best  methods  of  maintaining  that  relation,  is  the 
putting  of  all  possible  responsibility  upon  the  indi- 
vidual. Make  it  impossible  for  the  employee  to  say, 
concerning  his  own  particular  work,  "That  isn't  up  to 
me."  Put  it  up  to  him.  So  systematize  your  work  that 
each  part  of  your  working  machine  has  a  definite  duty 
to  perform.  Each  employee  should  do  something  en- 
tirely his  own,  be  the  boss  of  some  little  job  or  other. 

The  working  out  of  the  individual  responsibilities  is 
not  an  easy  task,  but  it  pays  for  the  trouble. 

Some  years  ago  I  took  charge  of  a  branch  express 
company  office  which  operated  some  thirty  wagons,  each 
with  a  driver  and  helper.  Expressmen  are  rather  above 
the  average  grade  of  carters,  but  they  can  hardly  be 
classed  as  ' 'high -brows. "  My  predecessor  had  been  a 
brawling,  order-yelling  sort  of  person  who  kept  the 
office  and  the  platforms  in  continual  confusion.  Patrons 
had  been  complaining  of  inattention  and  business  had 
been  falling  off.  When  I  took  charge  I  called  the  men 
together  and  said  to  them,  "Each  wagon  has  its  own 


KEEPING  YOUR   MEN  LONGER 65 

district,  and  I  want  the  driver  of  that  wagon  to  be  re- 
sponsible for  all  the  business  in  that  district;  when  you 
are  driving  about,  drop  in  now  and  again  on  the  people 
who  ought  to  have  express  matter.  Comb  your  whole 
district  thoroughly;  know  everybody  in  it. 

I  made  a  point  of  knowing  every  man  by  his  first 
name.  In  a  short  time  they  had  my  name — the  rougher 
class  of  workers  do  not  like  to  "mister"  anyone.  Per- 
haps my  dignity  suffered ;  but  I  got  results.  Those  men 
swelled  with  pride  in  bossing  their  own  jobs;  when  a 
shipment  of  express  matter  got  away  from  them,  they 
took  it  as  a  personal  grievance.  Our  business  increased 
a  third  during  the  first  month.  When  I  left  I  think  we 
were  getting  everything  possible  out  of  the  district. 
And  I  had  very  little  work  to  do.  I  made  suggestions 
from,  time  to  time,  but  I  never  gave  an  order. 

A  RBITRARILY  overriding  a  subordinate's  specific 
•it*,  authority,  or  ignoring  a  man  who  should  be  con- 
sulted, may  transform  a  good  worker  into  a  grumbler. 

I  did  not  discharge  a  man  in  two  years.  Most  drivers 
will  go  on  occasional  sprees,  but  I  never  had  the  same 
man  get  drunk  twice.  When  they  did  fall  from  grace 
and  turned  up  expecting  to  be  fired,  I  did  not  give  them 
lectures  upon  the  evils  of  drunkenness,  nor  draw  a  har- 
rowing picture  of  their  futures.  I  simply  passed  over 
the  lapse.  They  knew  that  I  was  not  fooled,  and  they 
so  appreciated  my  intentional  blindness  that  they  would 
not  again  put  me  in  a  position  where  I  might  have  to 
take  official  notice.  They  seemed  to  feel  that  it  would 
not  be  acting  quite  squarely  to  make  me  discharge  them. 

This  placing  of  responsibility  upon  the  individual 
worker  must  be  more  than  a  mere  form.  It  must  be 
accompanied  by  a  stern  rule  not  to  go  over  the  em- 


66  HOLDING    MEN 


ployee's  head  in  his  own  particular  province  of  author- 
ity. The  Pennsylvania  Railroad  never  permits  any 
official  to  go  over  a  subordinate's  head.  That  rule  is  the 
foundation  stone  of  their  magnificent  system.  Consult 
with  your  man  if  you  think  he  is  wrong,  argue  him 
around  to  your  way  of  thinking — there  is  always  the 
possibility  that  he  is  right  and  you  are  wrong.  And 
the  employee's  interest  and  self-respect  are  preserved. 
Once  ignoring  the  man  who,  in  the  usual  routine,  would 
be  consulted,  will  often  transform  a  good  employee  into 
a  grumbler. 

My  theories  are  not  at  all  original.  They  were  first 
stated  in  the  Golden  Rule.  I  restate  them  because  so 
many  employers  have  confused  effectiveness  with  what 
might  be  called  non-humanity.  Each  human  machine 
requires  its  own  peculiar  oil. 


NOT  only  is  the  shop  pay  roll  generally  the  largest  sintfle 
item,  of  manufacturing  cost,  but  it  is  an  item  which 
varies  because  human  nature  varies.  Behind  each  precise 
total  on  the  pay  roll,  is  the  story  of  the  man's  work  on  each 
job.  And  an  analysis  of  the  pay  roll,  consequently,  is  very 
often  the  interesting  study  of  men's  motives  in  doing  work. 
Any  manager  who  hasn't  looked  back  of  the  total  in  each  pay 
envelope  not  only  has  failed  to  make  the  most  of  his  pay  roll, 
but  has  missed  an  opportunity  to  get  in  closer  touch  with  his 
workmen.  3.  D.  RIDER, 

Vice-president,  South  Bend  Watch  Company 


VII 
HOW  WE  HOLD  OUR  MEN 

By  Frank  Disston,  '  J   i,  ..„ 

President,  Henry  Disston  &  Sons,  Incorporated,     . 


JACK  was  a  grinder — an  excellent  workman— ^but  a 
bit  too  fond  of  his  pot  of  ale.  Sometime*  he  held 
the  ale  as  more  interesting  than  the  grindstone  and  then  ? 
he  "stopped  out"  for  a  day  or  two.  By  all  the  accepted 
laws  of  good  shop  management  he  should  have  been  dis* 
charged,  but  Henry  Disston,  the  founder  of  our  busi- 
ness, discharged  a  man  only  when  he  could  think, of 
nothing  else  in  the  world  to  do.  He  never  fired  in -.the 
curt  way  that  obtains  in  so  many  shops. 

Jack  began  to  "stop  out"  more  than  he  worked.  •  At 
last  the  Disston  patience  broke.  Mr.  Disston  had  the 
choice  of  letting  the  man  go  or  of  demoralizing  the 
department,  so  he  decided  to  discharge  him. 

"Jack,"  he  said — only  first  names  are  used  about  the 
plant — "this  thing  has  gone  on  long  enough.  You  11 
have  to  clear  out;  you're  discharged." 

Jack  left.  But  on  the  next  morning  Mr.  Disston,  mak- 
ing a  shop  tour,  found  him  again  at  his  grindstone, 
working  as  though  nothing  had  happened. 

"Jack,  didn't  I  discharge  you  yesterday?  What  are 
you  doing  here?" 

"Ah!  Yes,  you  did,"  came  back  Jack,  "but  if  you 
don't  know  when  you  have  a  good  man,  I  know  when 
I  have  a  good  boss." 

Jack  stayed  and  he  did  not  "stop  out"  again.    I  do 


68  HOLDING   MEN 


not  know  how  many  grindstones  he  wore  out  in  the  many 
years  of  steady  work  after  that  time.  Certainly  he  must 
have  been  a  heavy  contributor  to  the  wall  of  discarded 
stones  that  encloses  the  factory  land. 

I  give  this  incident  not  as  an  example  of  how  to  treat 
men,  nor  as  a  clever  retort  by  which  a  workman  held  his 
job,  nor  again,  as  a  cheering  thought  to  alcoholics;  but 
as  illustrating  the  spirit  that  has  always  existed  in  the- 
relations  between  our  heads  and  our  employees.  Jack 
was  neither  clever  nor  impudent;  he  was  perfectly  sin- 
cere in  his  idea  that  what  he  himself  thought  about  hia 
job  was  of  equal  importance  with  what  his  boss  thought. 
He  felt  that  he  was  working  with  the  boss  and  not  for 
him. 

In  many  establishments  Jack  would  have  been  only 
' '  No.  520,  discharged  under  Rule  So  and  So,  for  absence 
from  duty,"  and  that  would  have  been  the  end  of  him. 
But  Mr.  Disston  knew  every  man  in  the  works  and  he 
had  no  rules.  He  did  what  he  thought  was  right  in  each 
individual  case.  He  felt  Jack  was  worth  another  trial 
— and  he  was.  Jack  made  good. 

Henry  Disston  is  dead,  but  his  ideas  of  man  manage- 
ment are  the  ideas  which  prevail  here  today.  They 
have  proved  their  worth  in  practice  and  we  have  never 
cared  to  change ;  we  have  no  use  for  systems  of  hiring 
and  firing;  we  want  no  tests  based  on  this  or  that  sup- 
posedly infallible  physical  or  mental  characteristic.  In 
other  words,  we  want  a  man,  and  not  a  machine;  we 
think  that  unquestioned  loyalty  and  an  eager  pride  in 
the  work  are  the  most  valuable  qualities  we  can  find  in 
a  man — and  we  get  them. 

"We  have  19  men  who  have  served  us  continuously 
for  fifty  years  or  more,  90  who  have  served  between 


"Do  we  lose  in  point  of  individual  efficiency  by  keeping  men  who 

are  long  past  the  supposed  age  of  efficient  effort?     Fred  J.  Smith 

has  been   straightening  saws  for  fifty  years  and  the  work  he  does 

is  well  up  with  that  of  the  average  of  the  younger  men" 


This  man,   Charles    Davenport,   is  connected  wilh    a    remarkable 

record.     He  i.t  one    of  ihc  original  helpers  of  the  founder  of  the 

Dinnton    business   and    four  generations  of    his  family    are    now 

represented  on  the  company's  payroll 


A   TESTED   PLAN 71 

forty  and  fifty  years,  238  who  have  been  here  for  be- 
tween thirty  and  forty  years;  320  are  in  the  class 
between  twenty  and  thirty  years;  and  763  have  been 
with  us:  for  more  than  ten  and  less  than  twenty  years. 

I  doubt  if  this  record  can  be  matched  by  any  other 
concern  in  the  United  States.  But  immediately  one 
will  ask,  "Are  you  running  a  saw  works  or  an  old 
men's  home?  Does  not  common  sense  tell  you  to  scrap 
men  as  well  as  machines?" 

PROOF  that  if  a  man  knows  he  is  a  real  part  of  the 
concern  he  is  happier  and,  therefore,  a  more  effective 
— and  a  more  loyal — worker. 

Common  sense  is  a  matter  of  circumstances.  We 
find  that  the  best  common  sense  is  to  keep  a  man  on  the 
job  to  which  he  is  accustomed,  as  long  as  he  does  good 
work  and  chooses  to  stay  there.  If  he  wants  to  retire 
on  a  pension,  we  retire  him;  but  if  he  wants  another 
job  about  the  place  we  find  that  job  for  him. 

When  Henry  Disston  was  asked  how  he  made  such 
fine  saws,  he  answered,  "Good  steel  and  honest  work." 
The  second  portion  of  that  phrase,  which  has  become 
our  factory  motto,  is  quite  as  important  as  the  first. 
You  might  have  the  best  steel  in  the  world,  but  after 
all  you  would  not  turn  out  good  saws  if  you  did  not 
have  men  who  were  just  as  much  interested  as  yourself 
in  making  a  good  saw. 

A  man  will  be  happier  in  his  work  if  he  knows  that 
he  is  a  real  part  of  the  concern,  if  he  knows  that  he  can 
spend  all  his  working  days  with  you  without  danger  of 
an  overnight  discharge.  We  believe  that  our  men  de- 
serve something  from  us  over  and  above  the  wages  we 
pay  them,  and  that  something  is  our  own  personal  affec- 
tion and  interest.  In  return  we  get  loyalty  and  good 


72  HOLDING   MEN 


work.  I  think  that  it  would  be  impossible  for  these 
men  to  turn  out  inferior  work.  Should  we,  in  a  fit  of 
lunacy,  order  a  lowering  of  standards,  I  imagine  that 
most  of  the  men  would  quit  their  jobs  immediately. 
That  is  the  reward  we  would  get  for  not  using  common 
sense  or  business  methods  or  applying  rules  alone 
instead  of  reason. 

Do  we  lose  in  point  of  individual  efficiency  by  keep- 
ing men  who  are  long  past  the  supposed  age  of  efficient 
effort?  Take  cases. 

Ben  Taylor  has  been  with  us  for  sixty  years.  Up 
until  three  years  ago  he  could  do  his  work  as  a  grinder 
as  well  as  anyone.  He  refused  to  take  a  pension  and 
we  put  him  on  the  door.  He  is  just  as  good  a  doorman 
as  he  was  a  grinder. 

Fred  J.  Smith  has  been  straightening  saws  for  55 
years  and  in  the  amount  and  quality  of  the  work  he  does 
he  is  well  up  with  the  average  of  the  younger  men. 
Jake  Noll,  with  52  years  of  service  behind  him,  is  still 
doing  the  delicate  work  of  blade-hardening  as  quickly 
as  the  men  of  half  his  age  who  work  with  him.  George 
Harris  has  kept  up  his  end  as  a  smither  for  54  years. 
George  Walker  worked  as  a  machinist  for  50  years. 
Then  his  health  began  to  fail  and  he  asked  to  go  on  the 
pension  list ;  he  bought  himself  a  farm  and,  in  two  years, 
had  so  recovered  that  he  came  back  for  his  old  job.  He 
worked  for  another  two  years  before  he  again  went  on 
pension. 

Harry  Piper,  with  51  years  of  service  behind  him, 
operates  a  lathe  as  well  as  he  ever  did.  Isaac  King 
and  William  Riehl  have  been  with  us  for  51  years,  and 
Austin  Carter  for  an  even  50.  All  three  of  these  men 
are  as  good  as  ever  they  were.  It  is  the  same  story 
throughout  the  whole  list  of  long-term  employees. 


A  TESTED  PLAN  73 


The  theory  that  a  skilled  mechanic  is  useless  after  he 
has  passed  the  fifty-year  mark  is  not  based  on  fact. 
The  older  man  cannot  always  move  about  so  rapidly 
as  the  younger  man,  but  where  the  work  requires  care 
and  skill  without  much  physical  activity  I  would  take 
the  older  in  preference  to  the  younger  man.  The  arbi- 
trary scrapping  of  men  because  of  age  is  a  sheer  waste 
of  economic  effort.  ' '  Old  age, ' '  we  find,  is  a  comparative 
term  and  is  something  more  than  years,  and  cannot  be 
easily  measured. 

These  men  add  stability  to  the  establishment  and  avoid 
the  constant  supervision  which  an  irresponsible  working 
force  requires.  The  boys  they  trained  as  apprentices 
are  working  side  by  side  with  them  and  absorb  the  tra- 
ditions of  the  shop.  They,  too,  catch  the  spirit  that  the 
most  important  thing  is  good  work — that  they  are  part 
and  parcel  of  a  big,  human  machine  which  is  creating 
a  product  that  must  be  kept  at  a  certain  established 
standard. 

The  attitude  of  the  corporation  toward  the  men  is  well 
expressed  in  an  address  by  the  late  Hamilton  Disston, 
the  eldest  son  of  Henry  Disston,  to  the  men,  after  the 
death  of  the  founder: 

"We  are  aware  that  while  inventive  talent  may  design 
and  intelligence  direct,  it  is  in  the  skill,  industry  and 
honest  labor  of  the  workmen  that  success  must  be  sought, 
and  that  by  their  exertion  the  world-wide  reputation  of 
the  Keystone  Works  has  been  maintained;  and  upon 
their  efforts,  directed  by  intelligence  and  prudence  on 
our  part,  depend  future  prosperity  and  success.  It  is 
not  necessary  that  we  should  give  you  any  assurance  of 
our  esteem  for  you  as  men,  of  our  confidence  in  you  as 
mechanics,  or  of  our  determination  to  follow  in  the 
same  liberal  and  generous  course  hitherto  pursued, 


74  HOLDING    MEN 


remembering  the  persevering  effort,  forgetting  the  occa- 
sional failure  to  succeed. 

"As  no  honest  workman  ever  appealed  in  vain  to 
Henry  Disston  for  sympathy  or  assistance,  or  failed 
to  receive  a  just  return  for  industry  or  skill,  so  we  assure 
you  that  our  intercourse  with  you  will  be  guided  by  the 
same  honorable  principles.  Relying  upon  our  knowl- 
edge of  the  business,  stimulated  by  past  success  and 
ambitious  for  the  future,  confiding  in  your  skill  and 
trusting  to  your  pride  in  the  works  which  you  have 
assisted  to  establish,  we  are  convinced  that  the  well- 
earned  character  of  our  manufactures  will  be  maintained 
and  the  range  of  their  usefulness  extended." 

F^ROM   the  beginning  of  the  Disston  business,  em- 
ployees have   been  hired,  trained,  and  helped  per- 
sonally, with  the  "big  family"  idea  always  in  mind. 

That  was  the  then  head  of  the  works  speaking  to  the 
associates  of  his  father.  To  understand  that  what  he 
said  was  not  mere  words,  it  is  necessary  to  understand 
something  of  the  development  of  the  Disston  works, 

Henry  Disston  started  as  an  apprentice  to  the  only 
saw-maker  of  the  time  in  the  United  States;  his  em- 
ployer failed  in  1840,  and  Henry,  taking  some  tools  and 
steel  in  lieu  of  wages,  started  a  saw  works  of  his  own 
in  a  Philadelphia  cellar.  He  was  the  whole  works  and 
also  the  wkole  selling  force;  he  had  no  capital  and  no 
credit.  The  jobbers  were  used  to  the  English  saws,  and 
they  would  have  nothing  of  the  domestic  make.  He 
was  confident  he  made  a  better  saw  than  any  other  man 
and  he  almost  forced  people  to  buy  them.  The  business 
grew,  slowly  at  first,  and  then  more  rapidly.  Always 
the  idea  was  to  make  the  best  possible  saw  and  this 
standard  could  be  kept  up  only  by  men  trained  to  care- 


A  TESTED   PLAN 75 

fill  work.  He  trained  all  his  workmen,  and  some  of 
those  men  who  worked  at  the  same  bench  with  the  great 
mechanic  are  employed  at  the  plant  today,  working  just 
as  faithfully  as  ever. 

The  boss  and  the  workmen  went  through  good  and  bad 
times  together.  "When  the  plant  burned  down  they  all 
pitched  in  and  built  another.  "When  the  Civil  War 
came  on,  Henry  Disston  told  the  men  that  he  would 
give  volunteers  a  bonus  of  half  the  army  pay  and  hold 
their  jobs  open.  A  company  was  formed  and  went  to 
war;  the  survivors  came  back  to  the  shops.  The  force 
was  a  sort  of  family,  and  a  family  it  has  always  re- 
mained. Its  history  repeated  itself  in  1915,  when  the 
same  arrangement  was  carried  out  with  the  forty  em- 
ployees who  answered  the  call  of  the  militia  and  served 
on  the  border. 

Henry  Disston  had  five  sons.  Three  of  them  went 
into  the  shops  and  worked  on  a  par  with  the  mechanics 
for  seven  or  eight  years,  the  fourth  went  into  the  ac- 
counting department,  and  the  fifth  studied  outside 
before  going  into  the  management.  Samuel  Disston 
spent  fifty-nine  years  in  the  shops,  starting  when  only 
eleven  years  old.  He  served  a  full  apprenticeship  in 
many  departments,  becoming  later  a  salesman  and  then 
for  many  years  secretary  and  general  manager.  The 
corporation  is  a  close  one  and  almost  every  Disston  who 
comes  into  an  executive  place  first  takes  from  five  to 
nine  years  in  the  shops  so  that  when  he  goes  into  the 
office  he  is  not  only  a  practical  saw-maker,  but  he  also 
knows  the  men  as  "Jack"  and  "Bill,"  and  the  men 
know  him  in  the  same  intimate  way.  An  identity  of 
interest  is  established;  there  is  no  wondering  what  the 
new  boss  is  like — the  men  have  known  him  as  one  of  the 
team.  The  only  executive  who  is  not  a  Disston  is  E.  B. 


76  HOLDING   MEN 


Roberts,  a  vice-president,  and  he  worked  his  way  up 
in  the  office. 

As  the  executive  is  a  family  affair,  so  is  the  personnel 
of  the  force.  Henry  Disston  took  on  indentured  appren- 
tices; now  indentures  are  done  away  with,  but  we  hold 
to  the  apprentice  system. 

"We  take  a  boy  of  fifteen  or  sixteen,  put  him  at  ordi- 
nary tasks,  and,  if  he  proves  bright  and  capable,  start 
him  as  an  apprentice  when  he  reaches  seventeen.  He 
works  at  apprenticeship  wages  until  his  majority,  and 
then  he  goes  on  the  journeyman  list.  There  is  no  rule 
about  selecting  the  boys,  except  that  a  boy  whose  father 
or  grandfather  worked  in  the  place  is  certain  to  be 
tried  out ;  we  want  those  to  whom  working  in  the  Disston 
works  is  the  natural  thing  to  do ;  thus  we  have  hundreds 
of  fathers  and  sons  and  scores  of  grandsons.  For  in- 
stance, there  are  three  generations  of  a  number  of  fam- 
ilies throughout  the  works. 

The  "big  family"  idea  is  carried  into  the  home  life. 
When  the  works  was  firmly  established,  and  Henry  Diss- 
ton saw  the  need  for  room  to  enlarge,  he  bought  several 
hundred  acres  on  the  Delaware  River  at  Tacony.  He 
reserved  fifty  acres  for  the  expansion  of  the  plant  and 
divided  the  balance  into  building  lots.  He  organized 
building  and  loan  associations,  helped  out  with  second 
mortgages,  and  in  every  way  encouraged  individual 
effort  toward  home  owning  and  home  building.  Today 
most  of  the  employees  own  the  homes  in  which  they  live. 
There  is  no  welfare  work,  however;  the  men  are  too 
independent  for  that — they  are  given  the  means  for 
doing  their  own  welfare  work. 

The  men  have  a  mutual  insurance  or  benefit  associa- 
tion which  is  managed  solely  by  themselves  and  a  con- 
dition of  membership  is  employment  in  the  Disston 


"Almost  every  Distort  irho  comes  info  an  executive  place  first  takes 

from  fire  or  nine  years  in  the  shops  so  that  ichen  he  goes  into  the 

office  he  knoics  the  man  as  'Jack'  and  'Bill'  " — S.  Horace  Dission 

(the  man  facing  you)   is  shoicn  at  work  in  the  Disston  factory 


"There  is  no  we1  fare  work  ....  the  men  are  too  independent 
for  that.  On  the  recreation  side  is  the  Disston  Athletic  Associa- 
tion. The  soccer  team  won  the  championship  of  the  United  Mates" 


It  is  the  belief  in  the  Ford  plant  that  men  who  spend  out-of-shop 
hours  in  dirty,  ill-ventilated  homes  arc  not  able  to  do  the  best  work. 
Accordingly,  investigators  are  constantly  suggesting  improvements 


A  TESTED  PLAN  79 


works.  They  announced  that  they  did  not  care  to  have 
a  regular  contribution  from  the  company,  and  accord- 
ingly the  company  gives  nothing  except  on  the  rare 
occasions  when  financial  help  is  acutely  needed.  The 
company  stands  ready  to  help,  but  helps  only  in  time 
of  stress. 

In  the  same  way  a  man  who,  through  illness  or  other 
misfortune,  suddenly  needs  money  can  come  unhesitat- 
ingly to  the  office  and  is  personally  loaned  whatever 
funds  he  needs.  It  is  a  purely  personal  affair  and  he 
does  not  have  to  make  a  formal  application  or  go  through 
any  humiliating  red  tape  or  investigations.  He  knows 
the  officer  with  whom  he  is  talking  and  the  officer  knows 
him — more  than  likely  they  have  worked  together  and 
certainly  they  have  often  spoken  with  each  other. 

MEETING  employees  on  a  man-to-man  basis  gains 
extraordinary    loyalty  for  the  Disston  company. 
Labor  turnover  in  one  year  was  less  than  five  per  cent. 

On  the  recreation  side  is  the  Disston  Athletic  Associa- 
tion, with  a  fine  playing  field.  The  soccer  team  won  the 
championship  of  the  United  States  and  the  baseball  nine 
took  the  industrial  championship  of  Philadelphia  re- 
cently. We  find  that  the  men  are  just  as  eager  to  have 
the  name  Disston  ahead  in  athletics  as  they  are  to  have 
it  ahead  in  factory  products. 

The  whole  thought  of  our  establishment,  and  the  rea- 
son that  we  gain  such  extraordinary  loyalty,  is  that  we 
work  with  our  men  and  they  work  with  us.  There  is 
no  gulf  between  the  shop  and  the  counting  room.  "We 
expect  the  men  to  come  to  us  with  their  troubles,  and 
they  come  as  friends.  We  know  them  and  they  know  us. 

We  make  the  working  conditions  just  as  favorable  as 
possible;  we  never  drive,  and  we  do  not  expect  a  man 


80  HOLDING   MEN 


to  wear  himself  out.  Most  of  the  work  is  on  a  piece 
basis  and  when  the  day 's  quota  is  done  the  man  may  go 
home  or  work  on,  just  as  he  chooses.  The  men  know 
that  the  shop  conditions  are  as  nearly  perfect  as  we 
can  make  them,  because  they  see  the  future  heads  of 
the  concern  working  side  by  side  with  them,  not  merely 
for  a  month  or  two,  but  for  from  five  to  ten  years.  They 
know  that  we  do  not  ask  them  to  do  anything  which  we 
have  not  done  ourselves  nor  which  we  are  not  willing 
to  have  our  own  children  do. 

In  short,  we  try  to  keep  away  from  the  very  idea  of 
capital  and  labor  and  to  get  on  the  man-to-man  basis. 
For  instance,  we  have  no  fixed  age  at  which  an  employee 
is  entitled  to  retire  on  a  pension,  and  neither  have  we  a 
fixed  pension.  Generally  the  pension  is  half  the  wage 
•which  has  been  received  in  actual  work,  but  sometimes 
we  pay  more  than  this  amount.  We  put  the  age  limit 
as  a  purely  individual  affair.  If  a  man  thinks  he  de- 
serves a  pension,  we  talk  the  matter  over  and  if  we 
agree,  he  gets  the  pension. 

I  think  this  personal  relation  is  the  ideal  way  of 
running  a  business,  although  I  suppose  it  is  old-fash- 
ioned. But  old-fashioned  or  not,  it  produces  results. 
Few  of  our  men  leave  and  nine  out  of  every  ten  who 
leave  come  back  again  for  their  old  jobs ;  the  discharging 
of  a  skilled  workman  is  so  rare  as  to  be  an  event.  The 
whole  labor  turnover  of  an  average  recent  year  was  only 
34%,  and  yet  this  was  high  because  extraordinary  con- 
ditions lured  away  some  of  the  unskilled  and  semi-skilled 
laborers.  The  turnover  among  the  skilled  men  was  less 
than  5%,  and  this  is  on  a  basis  of  3,600  employees. 

What  does  all  this  amount  to  in  dollars  and  cents? 
We  have  a  happy  institution,  but  is  it  an  efficient  insti- 
tution ?  You  cannot  have  a  permanently  happy  working 


A  TESTED  PLAN  81 


force  unless  the  stockholders  have  a  fair  return  upon 
their  money — that  is  why  so  many  humanely-managed 
concerns  have  failed  to  make  ends  meet. 

Yes,  working  together  pays.  It  has  paid  us  through 
more  than  three-quarters  of  a  century  of  steadily  grow- 
ing business.  We  have  been  able  constantly  to  better 
quality;  we  have  been  able  to  install  labor-saving  ma- 
chinery without  opposition,  for  the  men  know  that  the 
machines  are  put  in  to  aid  them  and  not  to  take  away 
their  jobs.  "We  have  been  able  to  lower  production  costs 
without  sacrificing  standards.  We  have  made  money. 

Are  not  some  of  the  so-called  efficiency  methods  in 
handling  workmen  merely  an  attempt  to  substitute  rule 
for  understanding — to  get  a  human  machine  because  the 
employer  does  not  know  how  to  get  a  fellow  workman? 

We  put  our  chief  trust  in  men;  they  know  it — and 
make  good. 


AS  AN  employer  of  over  five  thousand  workers,  I  am  nat- 
urally interested  in  knowing  what  they  are  thinking 
about.  Indeed,  it  is  an  important  part  of  my  duties,  as  a 
business  executive,  to  find  out  what  their  ideas  and  opinions 
are  and,  so  far  as  I  can,  to  embody  them  in  the  tasks  at  which 
they  are  engaged,  and  thus  to  make  capital  out  of  their  origi- 
nality and  their  suggestions.  The  fact  that  a  large  number  of 
patent  applications  bear  the  names  of  my  coworkers  here  in 
my  factory  is  evidence  of  the  value  of  the  help  that  I  have 
received.  THOMAS.  A.  EDISON, 

President,  Thomas.  A.  Edison,  Inc. 


VIII 


An  Interview  with  John  D.  Rockefeller,  Jr. 
By  Samuel  Crowther 

MOST  of  the  troubles  between  capital  and  labor, 
between  the  man  of  money  and  the  man  of 
muscle,  between  the  larger  employer  and  his  em- 
ployees— express  the  relation  as  you  like — disappear 
when  the  man  who  pays  and  the  man  who  earns  realize 
that  they  are  both  human  beings  with  interests  and 
desires  more  or  less  the  same. 

' '  An  absolutely  square,  frank  talk  in  which  the  points 
of  view  are  uncovered — in  which  each  grasps  the  thought 
process  of  the  other — permits  a  mutual  understanding. 
And  my  observation  and  experience  teach  me  that  mis- 
understanding is  at  the  bottom  of  every  labor  trouble. 
When  both  sides  play  fair,  the  differences  soon  solve 
themselves.  Sometimes  the  employer  forgets  that  the 
employee  is  human  and  sometimes  the  employee  forgets 
that  his  employer  is  human."  Thus  John  D.  Rockefeller, 
Jr.,  defines  capital  and  labor  in  terms  of  everyday  life. 
A  very  few  minutes'  conversation  will  banish  the  notion 
that  Mr.  Rockefeller  is  merely  the  son  of  his  father. 
He  is  thoroughly  a  personality — a  personality  of  ex- 
traordinary magnetism ;  I  can  easily  see  why  the  miners 
out  in  Colorado  like  him.  For  he  is  frank,  keen,  entirely 
human,  and  without  a  trace  of  what  the  English  call 
"side". 


WAYS  TO   MEET  LABOR  TROUBLES  83 

"In  the  days  when  employment  was  largely  a  per- 
sonal matter,"  continued  Mr.  Kockefeller,  "labor  trou- 
bles did  not  exist,  for  then  the  proprietor  and  the  worker 
were  always  in  touch  with  each  other.  But  the  modern 
large  organizations  tend  to  draw  a  line  between  capital 
on  the  one  side  and  labor  on  the  other  and  to  stimulate 
the  theory  that  if  capital  gets  more,  labor  gets  less. 
Hence  there  are  those  who  hold  that  if  labor's  wages 
are  increased  or  its  working  conditions  improved,  capital! 
suffers;  and  again,  on  the  other  hand,  men  hold  that 
labor  is  the  producer  of  all  wealth  and  is  entitled  to 
the  entire  product.  Some  of  the  men  in  Colorado  were 
firm  in  the  belief  that  all  which  capital  now  has  was 
originally  stolen  from  labor.  And  they  acted  accord- 
ingly. 

THE  employer  and  the  employee  are  partners  and  there 
must  be  an  equitable  division  of  profits,  Mr.  Rocke- 
feller feels.  Personal  contact  is  effective. 

"But  it  is  one  of  the  noteworthy  facts  of  industrial 
history  that  the  most  successful  enterprises  have  been 
those  which  were  so  well  organized  that  waste  was  elim- 
inated ;  then  the  laborers  were  not  only  paid  high  wages 
but  the  public  enjoyed  declining  prices  and  the  owners 
realized  large  profits.  Capital  cannot  exist  without 
labor  and  labor  cannot  rise  above  a  primitive  state 
without  capital.  The  two  are  necessary  partners  and, 
being  partners,  each  must  have  a  fair  share  of  the  profits. 
It  is  equally  unreasonable  to  imagine  that  capital  will 
exist  solely  to  support  labor  or  to  imagine  that  labor 
will  exist  only  to  support  capital.  They  must  divide 
profits.  What  is  a  fair  division  ?  Probably  no  division 
can  ever  be  absolutely  just ;  and  if  one  were  just  today, 
changed  conditions  might  make  it  unjust  tomorrow.  But 


84  HOLDING    MEN 


certainly  some  satisfactory  compromise  can  always  be 
arrived  at — unless  selfishness  and  short-sightedness 
animate  one  or  both  of  the  parties. 

"The  absence  of  personal  contact  between  the  owners 
and  the  wage  earners  prevents  compromises  from  being 
reached  on  the  subject  of  wages  and  it  also  puts  on  the 
shoulders  of  the  owners  the  numerous  injustices  and  dis- 
criminations of  the  petty  bosses.  The  foreman  and  the 
other  men  in  subordinate  authority  generally  rise  from 
the  ranks  and  they  often  become  swollen  with  their 
new  power;  they  discharge  men  without  reason  and 
they  do  many  other  acts  which  antagonize  the  workman. 

"As  regards  the  industrial  disturbances  in  Colorado, 
their  many  distressing  features  gave  me  the  deepest  con- 
cern. I  frankly  confess  that  I  felt  there  was  something 
fundamentally  wrong  in  a  condition  of  affairs  which 
made  possible  the  loss  of  human  lives,  engendered  hatred 
and  bitterness,  and  brought  suffering  and  privation 
upon  hundreds  of  human  beings.  I  determined,  there- 
fore, that  in  so  far  as  it  lay  within  my  power  I  would 
seek  some  means  of  avoiding  the  possibility  of  similar 
conflicts  arising  elsewhere  or  in  the  same  industry  in 
the  future. 

"Following  that  strike,  a  plan  was  formulated  by 
which  future  misunderstandings  might  be  prevented. 
The  mere  settlement  of  a  temporary  difference  is  noth- 
ing— the  parties  must  get  upon  a  permanent  basis  of 
relationship. 

"I  felt  that  it  would  help  me  to  gain  a  better  idea  of 
the  laboring  man's  position  and  also  help  him  to  gain 
a  better  idea  of  the  employer's  position  if  I  went  out 
to  the  mines.  I  spent  several  weeks  among  the  men  at 
the  camps  and  in  the  mines.  I  visited  the  men  and  their 


WAYS  TO    MEET  LABOR   TROUBLES 


85 


KriwdteHf 

FIGURE  I:     This  is  a  graphic  representation  of  the  "Industrial  Con- 
stitution" which  Mr.  Rockefeller  and  his  associates  used  to  accomplish 
the  five  objects  listed  Chapter  VIII.     During  the  time  tlu  t  it  has  been  in 
operation  it  has  proved  entirely  satisfactory 


86  HOLDING    MEN 


families;  I  went  down  into  the  mines — I  went  every- 
where and  tried  to  see  everything. 

"I  came  upon  many  men  unexpectedly;  to  them  I 
introduced  myself;  others  were  introduced  to  me.  We 
talked  over  all  our  relations  with  the  utmost  frankness 
and  I  gained  a  very  fair  knowledge  of  their  point  of 
view.  I  found  them  uniformly  open  minded  once  they 
discovered  that  I  really  wanted  their  opinions;  they 
were  perfectly  willing  to  come  half  way  on  any  reason- 
able proposal  submitted  to  them.  For  instance,  I  found 
that  they  imagined  that  Rockefellers  had  been  drawing 
immense  profits  from  their  interests  in  Colorado ;  no  end 
of  people  had  told  them  so.  I  explained  the  exact  situa- 
tion to  them.  I  showed  them  that,  during  the  fourteen 
years  in  which  we  had  been  connected  with  the  Colorado 
Fuel  and  Iron  Company,  it  had  never  paid  one  cent  in 
dividends  upon  the  common  stock. 

"At  one  of  our  meetings  I  gave  a  practical  illustration 
of  the  finances  of  the  company.  I  put  a  number  of  coins 
on  a  table.  I  swept  off  a  portion  which  represented  their 
wages — for  the  first  claim  upon  the  company  is  the 
payroll.  Then  I  took  away  more  coins  to  represent  the 
salaries  of  the  officers  and  then  the  remaining  coins  to 
represent  the  fees  of  the  directors.  There  were  no  coins 
left  for  the  stockholders.  And  then  I  asked:  'Men,  is 
it  fair,  in  this  corporation  where  we  are  all  partners, 
that  three  of  the  partners  should  get  all  the  earnings,  be 
they  large  or  small — all  of  them. — and  the  fourth  noth- 
ing?' After  the  illustration  one  of  the  men  made  a 
speech  for  higher  wages.  I  asked  him,  '  Is  it  square  for 
you  to  want  more  wages  when  one  of  the  partners  gets 
nothing  ? '  He  admitted  that  it  did  not  look  like  a  square 
deal ;  I  heard  no  more  about  increasing  the  wages. 

"The  only  trouble  with  those  men  was  that  they  had 


WAYS  TO   MEET  LABOR  TROUBLES  87 

not  known  the  facts ;  once  they  were  sure  that  they  were 
not  being  cheated,  they  were  reasonable.  They  recog- 
nized that  if  labor  insisted  upon  getting  all,  capital  must 
withdraw.  The  men  saw  that  the  owners  were  only  after 
a  square  deal  all  around.  The  machinery  for  securing 
this  square  deal  is  contained  in  an  industrial  constitu- 
tion and  a  trade  agreement  which  were  submitted  to  a 
referendum  of  all  the  employees  and  adopted  by  a  vote 
of  2,404  to  442.  Both  of  these  instruments  are  compre- 
hensive and  a  copy  of  each  is  in  the  hands  of  every  em- 
ployee. 

"The  agreement  covers  the  rent  of  dwellings,  the 
rates  for  light  and  water,  the  prices  of  powder  and 
domestic  coal,  the  fencing  of  employee's  homes,  the  re- 
moval of  garbage,  the  providing  of  bath  and  club  houses, 
the  stipulation  of  an  eight  hour  day  for  all  employees 
working  underground  and  in  coke  ovens;  a  nine  hour 
day  for  outside  labor,  the  semi-monthly  payment  of 
wages  and  an  agreement  not  to  change  hours  or  wages 
without  thirty  days'  notice  and  that  there  should  be  no 
increase  in  wages  for  any  cause  during  the  period  of  the 
agreement  unless  a  general  increase  in  wages  should  be 
made  in  a  competitive  district,  in  which  case  a  propor- 
tional increase  would  be  given. 

"The  basis  of  relationship,  the  methods  for  adjusting 
differences  and  for  keeping  both  employer  and  employee 
happy  are  contained  in  the  industrial  constitution.  This 
is  a  real  constitution  which  establishes  a  real  democracy 
between  the  owners  and  the  workers  of  the  company. 
It  is  the  best  way  we  have  been  able  to  find  to  bring  all 
parties  onto  a  common  ground.  The  constitution  stipu- 
lates that  there  shall  be  a  strict  observance  by  both  the 
management  and  the  men  of  the  federal  and  the  state 
laws  respecting  mining  and  labor  and  that  the  scale  of 


88  HOLDING    MEN 


wages  and  the  rules  in  regard  to  the  working  conditions, 
shall  be  posted  in  a  conspicuous  place  at  or  near  every 
mine.  No  employee  may  be  discharged  without  notice 
except  for  such  offenses  as  are  posted  at  each  mine.  For 
such  offenses  as  are  not  posted,  the  offending  employee 
must  receive  a  warning  in  writing  that  a  repetition  of 
the  offense  will  bring  about  his  discharge. 

"  Among  the  fundamental  rights  guaranteed  to  the 
men  is  that  there  shall  be  no  discrimination  on  account 
of  membership  or  non-membership  in  any  society,  fra- 
ternity or  union.  They  have  the  right  to  hold  meetings 
on  company  property,  and  to  make  their  purchases 
wherever  they  choose  and  to  employ  check  weighmen. 
These  portions  are  what  might  be  called  the  'Bill  of 
Rights'  of  the  constitution.  The  wage  earners  at  each 
camp  elect  representatives  annually  on  the  basis  of  one 
representative  for  each  one  hundred  and  fifty  wage 
earners  with  a  minimum  representation  of  two  delegates. 
These  men  are  recognized  by  the  company  as  the  author- 
ized representatives  of  their  constituents  and  they  can 
treat  with  the  officers  as  to  terms  of  employment,  on 
working  and  living  conditions,  and  the  general  adjust- 
ment of  differences.  A  meeting  of  all  of  the  represen- 
tatives with  the  general  officers  of  the  company  must 
be  held  at  least  once  a  year  to  consider  questions  of  gen- 
eral importance. 

THE  president  of  the  company  and  representatives  of 
the  men  meet  periodically  to  adjust  complaints  and 
grievances  before  they  reach  the  stage  of  discontent. 

"The  camps  of  the  company  are  divided  into  districts 
and  each  district,  through  its  camp  representatives, 
meets  at  least  three  times  a  year  with  the  president  of 
the  company  to  go  over  all  matters  of  mutual  interest 


WAYS  TO    MEET  LABOR  TROUBLES  89 

and  concern.  These  district  conferences  appoint  a  num- 
ber of  committees  on  industrial  relations  of  six  members 
each,  three  members  being  appointed  by  the  representa- 
tives and  three  by  the  president.  The  committee  on 
industrial  cooperation  and  conciliation  consider  all  mat- 
ters pertaining  to  the  prevention  and  settlement  of  in- 
dustrial disputes,  terms  and  conditions  of  employment, 
maintenance  of  order  and  discipline,  and  the  policy  of 
the  company.  There  are  committees  on  safety  and  acci- 
dents, on  sanitation,  on  health  and  housing  and  on  recre- 
ation and  education.  In  other  words,  the  representa- 
tives of  the  company  and  the  representatives  of  the  men 
are  formed  into  small  committees  covering  small  geo- 
graphical areas,  so  that  every  local  need  or  complaint 
may  find  a  ready  means  for  adjustment. 

' '  In  addition  to  and  supplementing  the  representation 
portion  of  the  plan,  an  officer  known  as  the  president's 
industrial  representative  is  added  to  give  an  easy  means 
for  any  employee  to  appeal  directly  to  the  president  of 
the  company.  This  officer  goes  at  once  to  any  camp  on 
the  request  of  the  representatives,  but  he  also,  without 
request,  makes  as  many  visits  as  possible.  Every  day 
he  turns  in  to  the  president  a  report  of  that  day's  work. 
Thus  no  man  has  an  excuse  to  harbor  a  grievance ;  he 
always  has  the  opportunity  to  directly  reach  the  presi- 
dent. 

"David  Griffith  has  acted  as  the  president's  indus- 
trial representative  with  remarkable  success.  He  has 
succeeded  in  settling  almost  every  complaint  because  he 
has  the  confidence  of  all  parties. 

"The  whole  thought  of  the  industrial  plan  is  to  make 
it  impossible  for  any  complaint — reasonable  or  unrea- 
sonable— to  go  unheard  or  fail  to  be  disposed  of 
promptly  and  fairly. 


90  HOLDING    MEN 


"Here  are  the  numerous  authorities  to  whom  a  com- 
plaint may  be  carried.  Suppose  a  miner  has  a  griev- 
a.nce.  He  may  himself,  or  through  one  of  the  represen- 
tatives, seek  satisfaction  from  the  foreman  or  mine 
superintendent.  From  them  he  may  appeal  to  the  pres- 
ident's representative,  and  from  him,  successively,  to 
the  division  superintendent,  assistant  manager,  man- 
ager, general  manager,  and  president.  Or,  instead  of 
appealing  to  individuals,  the  complainant  may  go  from 
the  foreman  or  mine  superintendent  to  the  committee  on 
industrial  cooperation  in  his  district;  if  the  committee 
itself  does  not  agree,  it  may  select  one  or  three  umpires 
to  settle  the  dispute.  And,  finally,  the  employee  may 
go  to  the  Colorado  State  Industrial  Commission.  And 
the  company  must  pay  the  expenses  of  any  or  all  such 
appeals,  including  the  worker's  loss  of  time. 

"The  plan,  during  its  operation,  has  worked  exceed- 
ingly well.  The  right  of  complaint  has  been  freely  exer- 
cised and  the  decisions,  by  whomsoever  given,  have  been 
received  as  satisfactory.  The  representatives  as  elected 
by  the  workers  are  a  splendid  lot  of  men  working  legit- 
imately for  the  best  interests  of  their  constituents  and 
not  at  all  inclined  to  frivolous  complaints.  The  plan 
has  been  criticised  as  being  dependent  on  both  sides 
acting  squarely.  Of  course  it  is,  but  it  also  gives  the 
best  possible  chance  for  all  parties  to  act  squarely  and 
the  least  possible  chance  to  act  otherwise.  And  if  any- 
one decides  to  be  unfair — will  any  plan  work?" 


HE  greatest  thought  of  this   century   is   the  transfer- 
ence of  value  from   property   to   the  human   being. 
PROFESSOR  ROSCOE  POUND, 

Harvard  University 


IX 

THE  HIGH  COST  OF  LABOR 
THAT  COMES  AND  GOES 


By  Leon  I.  Thomas 
Based  on  an  Extensive  Investigation 


IT  has  cost  this  company  half  a  million  dollars  because 
we  located  our  factory  out  here  two  miles  from 
town."  True,  the  employment  man  who  recently  made 
this  statement  to  one  of  the  directors  of  his  company 
had  just  been  listening  to  dozens  of  workmen  who,  when 
they  left  this  firm's  employ,  explained  that  it  was  "too 
far  to  come,"  "too  hard  to  get  to,"  "took  too  long  to 
reach." 

But  he  came  to  this  conclusion  from  a  large  experi- 
ence rather  than  from  several  months'  daily  contact 
with  dissatisfied  men.  He  realized  that  there  is  another 
side  to  the  pure-air  and  lots-of-room-to-grow  arguments 
for  outlying  plants.  He  is  a  close  student  of  labor  turn- 
over and  he  knows  of  the  far-reaching  costs  of  hiring 
and  firing. 

Of  all  the  reasons  given  for  workmen  leaving,  com- 
plaint about  plant  location  cited  is  somewhat  unique 
and  probably  more  prominent  right  now  than  it  is  in 
normal  times  when  vacancies  do  not  outnumber  appli- 
cants. But  there  are  other  reasons  for  labor  turnover 
which  are  evident  at  all  times.  Few  managers  waste 
any  time  arguing  as  to  how  sinister  a  factor  labor 
turnover  is.  They  well  know  its  evils.  Some  attempts 
have  been  made  to  figure  out  how  much  it  costs  a  firm 


92 HOLDING   MEN 

to  break  in  a  new  man.  Probably  few  have  ever  come 
very  close  to  it.  If  more  managers  knew  what  this 
figure  was  in  dollars  and  cents  they  would  probably  use 
their  power  of  discharge  with  greater  care. 

At  certain  times  when  rival  manufacturers  almost 
come  to  blows  in  competing  for  men,  the  turnover  prob- 
lem is  handled  not  so  much  from  the  discharging  side 
as  from  the  point  of  view  of  the  development  of  ways 
to  hold  the  men  already  employed  and  to  establish  a 
policy  in  the  treatment  of  employees  that  will  attract 
the  best  men  and  hold  the  old  ones. 

r  I  BAKING  care  in  hiring  help  keeps  down  the  high  cost 
A    of  labor  turnover.     Why  men  of  the  "floater"  type 
are  likely  to  continue  their  "floating." 

One  way  that  some  factory  executives  go  about  the 
problem  is  to  exercise  care  in  hiring  men  in  the  first 
place.  For  instance,  the  employment  manager  at  one 
automobile  company  finds  that  when  there  is  a  scarcity 
of  labor  about  the  only  steps  he  can  take  is  to  assure 
himself  by  investigating  references  that  only  those  men 
are  hired  who  have  stayed  on  three  previous  jobs  a  rea- 
sonable length  of  time.  One  Chicago  concern  keeps  in 
an  "excuse"  book  a  record  of  the  reasons  men  give  for 
leaving.  It  does  this  not  with  the  idea  of  having  a 
record  of  the  individuals  who  quit,  but  as  a  guide  in  the 
future  to  employing  men.  Of  course,  it  also  has  its 
uses  in  eliminating  features  in  the  plant  to  which  men 
object. 

Labor  turnover  has  been  defined  as  the  employing  of 
too  many  poor  workmen  to  get  a  standard  organization 
of  good  men  for  a  plant.  The  poor  workmen  are  elim- 
inated from  an  organization  (1),  by  being  discharged; 
(2),  by  being  laid  off;  (3),  by  quitting  voluntarily. 


CUTTING  LABOR   TURNOVER   COSTS  93 

Aside  from  the  fact  that  these  inferior  men  ought  not 
to  have  been  hired  in  the  first  place,  no  manager  cares 
much  by  which  of  these  methods  the  poor  workmen  are 
eliminated,  but  unfortunately  two  of  these  general  ways 
that  men's  names  are  dropped  from  the  payroll  apply 
to  good  employees  as  well  as  poor  ones.  Good  workmen 
are  laid  off  during  dull  seasons,  although,  of  course, 
most  managers  aim  to  keep  the  best  men,  and  capable 
employees  quit  of  their  own  accord.  Perhaps  it  should 
be  said  that  all  three  of  the  methods  of  elimination  of 
poor  men  apply  to  good  men  because  sometimes  skilled 
men  have  to  be  fired,  but  generally  in  this  case  proper 
management  methods  find  a  way  for  avoiding  it. 

Why  are  men  discharged?  While  incompetence  and 
insubordination  would  seem  at  first  glance  to  be  the 
leading  reasons  for  discharge  is  it  not  true  that  most 
men  are  fired  arbitrarily  through  the  whim  of  a  fore- 
man? Perhaps  it  is  because  of  religious  or  national 
prejudice  or  perhaps  merely  the  outward  effect  of  a 
grouch — but  almost  always  unnecessary. 

But  what  is  the  way  out  of  it  ?  Just  as  many  a  man- 
ufacturer has  followed  Ford  methods  of  production 
others  have  profited  by  some  of  the  management  meth- 
ods of  this  company,  and  one  method  has  a  particular 
bearing  on  labor  turnover.  The  foremen  do  not  have 
the  authority  to  fire  a  man.  They  may  effect  his  trans- 
fer to  another  department,  but  they  cannot  discharge 
him.  Among  some  concerns  there  is  the  feeling  that  to 
take  away  the  power  of  discharge  from  a  foreman  is 
to  impair  his  initiative  and  decrease  his  hold  on  his 
men.  Another  point  of  attack,  of  course,  is  to  raise  the 
quality  of  foremen,  to  instill  through  personal  contact 
and  foremen's  meetings  more  tact  and  other  managerial 
qualities  into  these  overseers  of  men. 


HOLDING   MEN 


Has  the  average  concern  a  legitimate  excuse  in  dis- 
charging a  man  because  he  is  incompetent,  assuming 
that  he  was  hired  only  after  due  consideration  in  the 
first  place.  In  this  case  wouldn't  a  little  training  added 
to  what  he  does  know  about  a  job  make  him  a  worth 
while  employee?  Isn't  it  possible  that  a  man  who  is 
incompetent  in  one  job  might  be  skilled  in  another? 

It  is  a  motto  at  the  Ford  plant  that  it  is  better  and 
cheaper  to  fit  than  to  fire.  In  fact,  Dean  Marquis  of 
the  Ford  organization  says  that  the  best  way  they  have 
found  to  hold  down  labor  turnover  is  by  shifting  men 
again  and  again  until  they  find  the  job  for  which  they 
are  fitted.  As  evidence  that  this  company  practices 
what  it  preaches,  it  has  discharged  only  five  men  in  ten 
months  out  of  a  force  of  forty  thousand.  Apprentice- 
ship courses  have  been  suggested  along  lines  which 
bring  out  a  man's  aptitude  for  certain  kinds  of  work 
and  thus  play  a  large  part  in  the  selection  of  men  for 
jobs  to  which  they  are  fitted.  This  may  prove  a  growing 
factor  in  the  reduction  of  labor  turnover. 

Insubordination  as  an  excuse  for  discharging  a  man 
seems  legitimate  and  in  most  cases  probably  is.  But 
even  here  is  it  not  true  that  insubordination  is  often  the 
result  of  the  manner  in  which  an  order  is  given  or  a 
request  made  ?  Isn  't  it  worth  while  to  develop  a  higher 
type  of  foreman  with  this  in  mind? 

Sometimes  men  are  fired  because  they  "cannot  get 
along"  with  other  workmen.  Much  of  this,  too,  may  be 
the  workman's  fault,  but  the  management  has  ample 
opportunity  to  minimize  this  defect  by  placing  him 
among  men  congenial  to  himself  or  even  by  shifting  him 
to  another  department  where  he  is  equally  useful. 

One  phase  of  labor  turnover  comes  under  the  sole 
responsibility  of  the  management  and  that  is  when  men 


CUTTING  LABOR  TURNOVER  COSTS     95 

leave  a  company's  employ  because  they  are  laid  off. 
While  this  is  often  beyond  the  control  of  the  executives 
of  a  business,  managers  are  giving  considerably  more 
thought  to  it  than  formerly.  They  hesitate  a  little  longer 
before  dropping  a  number  of  men  with  the  thought  that 
they  can  easily  hire  another  group  next  week  or  next 
month.  They  see  the  dollars  and  cents  involved  in  such 
a  thoughtless  program. 

Often  it  is  hard  to  avoid  laying  off  men,  but  too  fre- 
quently poor  scheduling  of  work  or  faulty  ordering  of 
material  which  does  not  reach  the  plant  in  time  must  be 
accepted  as  the  real  excuses.  Dull  seasons  which  cause 
peaks  and  hollows  in  the  year's  production  curve  are 
enemies  to  the  efficient  maintenance  of  a  labor  force. 
Such  conditions  were  formerly  taken  for  granted  where 
now  many  concerns  have  adopted  ways  to  smooth  out 
the  curve.  Manufacturing  for  stock  is  a  way  out  of 
the  difficulty  in  some  lines  of  business.  Selling  summer 
season  goods  in  the  tropics  during  the  winter,  amplify- 
ing the  advertising  appropriation  during  dull  season 
and  taking  on  a  "fill-in"  product  are  ways  the  problem 
has  been  attacked. 

If  some  such  methods  as  these  had  been  adopted  per- 
haps the  following  report  from  the  New  York  State 
Factory  Investigating  Commission  would  not  read  as  it 
does.  "In  57  shirt  factories  in  New  York  state,  10,150 
persons  were  employed  in  the  rush  weeks  as  compared 
with  7,657  in  the  slack  season — a  variation  of  30  per 
cent.  The  fluctuation  in  wages  amounted  to  46  per  cent. 
In  45  firms  in  New  York  City  and  sixteen  up-state  firms 
manufacturing  confectionery,  the  number  of  employees 
varied  in  one  year  from  9,700  during  one  month  to  7,100 
eight  months  later — an  annual  displacement  of  27  per 
cent.  The  variations  in  wages  paid  were  from  $79,000 


HOLDING    MEN 


in  one  week  to  $52,600  another — a  drop  from  high  to 
low  of  34  per  cent. ' ' 

Where  dull  seasons  are  unavoidable,  some  concerns 
follow  the  policy  of  cutting  down  the  hours  of  piece- 
workers and  thus  reduce  the  earnings  but  distributing 
the  work  in  such  a  way  as  never  to  deprive  the  em- 
ployees entirely  of  support.  Only  those  employees  who 
have  been  with  a  concern  the  longest  or  those  who  are 
the  most  skillful  are  likely  to  complain  of  such  an 
arrangement. 

HERE  are  ten  basic  reasons  why  men  quit  jobs — 
most  of  these  causes  can  be  remedied  by  sound  man- 
agement and  proper  supervision  of  employment  conditions. 

Perhaps  the  most  frequent  cause  of  large  labor  turn- 
over, particularly  in  prosperous  times,  is  the  voluntary 
quitting  of  employees.  And  why  do  men  quit  of  their 
own  accord?  Probably  most  of  the  reasons  are  included 
in  this  list:  because  of  low  wages,  of  long  hours,  of 
inequalities  in  pay,  of  fancied  wrongs,  of  poor  working 
conditions,  of  dislike  for  a  particular  kind  of  work,  of 
inability  to  get  along  with  fellow  workers,  of  poor  loca- 
tion of  plants,  of  inability  to  see  a  future,  of  wander- 
lust. And  most  of  these  causes  find  a  remedy  in  sound, 
up-to-date  management. 

Perhaps  the  first  reason,  low  wages,  is  least  amenable 
to  management  methods,  for  in  the  long  run  wages  are 
determined  by  the  labor  market  and  find  an  upper  limit 
dictated  by  competition  made  evident  through  sales 
prices.  Some  factory  men,  however,  believe  that  under 
proper  management  conditions  the  raising  of  wages  may 
be  followed  by  the  cutting  of  costs.  They  feel  that  this 
may  come  about  not  only  through  production,  but  be- 
cause of  the  elimination  of  labor  troubles,  the  securing 


CUTTING   LABOR  TURNOVER   COSTS  97 

of  the  most  skilled  help  in  a  given  locality.  This  is  in 
effect,  of  course,  the  plan  followed  by  the  Ford  Com- 
pany in  its  now  famous  five-dollar-a-day  minimum. 

Long  hours  may  well  be  a  reason  for  a  large  labor 
turnover  which  is  a  detriment  far  out  of  proportion  to 
the  inefficient  output  of  the  hour  or  two  excess  over  the 
customary  working  day.  A  low  scale  of  wages,  many 
firms  have  learned,  may  not  discourage  so  many  men  as 
inequalities  in  its  distribution  among  the  workers. 
Quoting  from  Boyd  Fisher,  Vice-president  of  the 
Detroit  Executives'  Club,  "this  constitutes  the  worst 
injustice  of  all."  He  cites  one  employment  manager 
who  discovered  a  workman  who  had  been  on  the  same 
rate  of  pay  for  five  years.  "He  is  now  seeing  to  it  that 
men  in  his  company  are  periodically  advanced  or  pro- 
moted in  accordance  with  their  efficiency  records  regard- 
less of  whether  they  ask  for  increases  in  basic  rates  or 
not."  Some  managers  attempt  to  overcome  the  unjust 
distribution  of  wages  by  paying  for  men's  output  and 
this,  of  course,  has  led  to  all  sorts  of  wage-payment  plans 
from  the  simple  piecework  to  some  of  the  highly  compli- 
cated bonus  forms  of  payment. 

Because  a  wrong  is  only  fancied  instead  of  being  real 
does  not  help  the  employment  man  or  the  turnover 
record  any.  If  a  man  thinks  he  is  not  being  treated 
right  and  jobs  are  plentiful  he  leaves;  whether  there  is 
any  basis,  in  fact,  for  it  is  outside  the  question.  Is  it 
not  probable  that  a  better  man-to-man  supervision  is 
one  way  to  clear  up  these  fancied  wrongs?  Perhaps 
authority  of  straw  bosses  should  be  reduced,  perhaps  a 
closer  contact  with  the  men  higher  up,  perhaps  an  in- 
sight into  the  aims  and  policies  behind  a  business  will 
straighten  out  some  of  these  psychological  reasons  for  a 
man's  quitting. 


98  HOLDING   MEN 


As  an  instance  of  the  plan  of  letting  workmen  know 
the  policies  of  a  concern,  the  things  for  which  it  stands ; 
in  other  words,  what  it  is  all  about,  might  be  cited  that 
of  the  Packard  Piano  Company.  Mr.  Bond,  the  presi- 
dent of  the  company,  has  but  to  open  the  middle  drawer 
of  his  desk  to  show  you  the  written  policy  of  his  concern 
subscribed  to  by  each  of  the  men  in  the  plant.  They 
know  what  they  as  units  and  as  an  organization  are  aim- 
ing at  and  they  know  the  management  point  of  view 
toward  them. 

TF  THE  worker  feels  his  employer  has  a  sincere  interest 
•I  t'n  him  he  is  a  better  worker.  How  welfare  work  of 
almost  every  nature  helps  strengthen  this  feeling. 

In  some  plants  it  is  felt  that  definite  evidences  of 
team  work  between  management  and  men  are  helpful 
in  smoothing  out  petty  wrinkles  in  handling  labor.  For 
instance,  one  Massachusetts  concern,  where  a  large  num- 
ber of  Swedish  people  are  employed,  recently  held  a  folk 
fest.  The  general  manager  of  the  concern  headed  the 
procession  at  this  event  and  the  board  of  directors  were 
all  there.  Later  there  was  a  ball  game,  then  a  parade  in 
which  the  executives  figured  prominently.  This  show 
of  interest  was  not  merely  staged,  but  sincere  and  it 
had  its  effect.  One  specific  result  mentioned  by  the  em- 
ployment manager  of  this  company  was  that  shortly 
after  the  folk  fest  four  times  as  many  people  applied 
for  jobs  as  did  in  the  few  days  before  the  event  and 
after  the  ball  game  six  times  as  many  wanted  jobs  as 
before  either  of  these  events  took  place. 

Manufacturing  standards  in  general  are  such  that 
nnhealthful  working  conditions  in  plants  are  fast  disap- 
pearing and  where  prevailing  standards  offer  no  spur, 
competitive  conditions  do,  so  that  only  those  factories 


CUTTING   LABOR  TURNOVER   COSTS          99 

operated  from  the  safety  and  health  standpoint  secure 
the  pick  of  labor. 

According  to  W.  A.  Grieves,  Supervisor  of  Employ- 
ment and  Welfare  Work  in  the  Nash  Motors  (Jeffrey 
Manufacturing)  Company,  mutual  aid,  hospital  work, 
restaurant,  cooperative  store,  bakery,  dairy,  building 
and  loan  association,  are  all  factors  in  the  permanency 
of  the  labor  force  in  that  company.  No  workman  need 
feel  that  he  may  be  jeopardizing  his  health  by  working 
with  a  fellow  employee  who  has  a  contagious  disease  in 
a  plant  where  physical  inspection  is  part  of  the  employ- 
ment and  labor  maintenance  program. 

Fewer  men  would  leave  a  plant  and  give  at  the  next 
one  the  excuse,  "I  didn't  like  the  work,"  if  the  first 
one  had  in  its  organization  what  might  be  called  a  clear- 
ing house  for  labor  between  departments.  At  least, 
many  concerns  like  the  Ford  Motor  Company  find  that 
it  pays  to  shift  men  from  job  to  job  until  they  find  one 
to  which,  by  skill  and  preference,  they  are  best  suited. 
Then,  perhaps  a  man  liked  his  work  originally  but  has 
been  kept  on  the  same  thing  too  long.  Was  the  man  far 
wrong  who  said  that  the  difference  between  a  rut  and 
the  grave  is  only  a  question  of  dimensions? 

There  is  also  the  man  who  quits  because  he  cannot  get 
along  with  his  fellow  workers.  Isn't  there  a  manage- 
ment remedy  that  fits  this  man's  case?  Can  he  be 
placed  in  another  department  among  fellow  employees 
with  whom  his  nationality  or  sentiments  do  not  clash? 
Here  again,  the  tact  and  skill  of  a  high  type  of  foreman 
pay  dividends. 

The  effect  of  plant  location  on  employment  conditions 
was  commented  on  at  the  very  first  of  the  chapter.  As 
was  said  then,  this  as  a  factor  may  be  larger  in  abnor- 
mal than  in  normal  times.  But  always  living  conditions 


100  HOLDING    MEN 


have  a  bearing  on  the  subject  and  if  satisfactory  living 
quarters  can  be  found  only  at  the  expense  of  a  ten-cent 
fare  or  an  hour's  ride  it  may  be  reflected  in  the  labor 
turnover  figures. 

Some  wise  managers  have  foreseen  the  monopolizing 
by  real  estate  concerns  of  desirable  property  for  homes 
and  have  cooperative  plans  which  make  it  easier  for 
employees  to  buy  their  homes  or  to  rent  them  at  a  rea- 
sonable figure.  Where  men  buy  homes,  there  is  oppor- 
tunity for  holding  down  ill-considered  resignations. 

One  Iowa  concern  lays  a  great  emphasis  on  the  men 
owning  their  own  homes.  One  of  the  questions  asked 
of  every  applicant  is  whether  he  is  in  position  to  pay 
something  on  a  home.  If  not,  he  is  asked  if  he  will 
start  saving  for  one  as  soon  as  he  is  able.  The  man's 
expression  in  this  regard  is  taken  into  consideration  in 
accepting  him.  Just  as  monopoly  on  real  estate  may  be 
offset  by  a  company-controlled  building  and  loan  plan 
so  cooperative  stores  may  become  a  factor  in  holding 
your  men. 

Every  manufacturer  seriously  considers  the  question 
of  waste,  but  there  is  one  waste  going  on  in  many  organ- 
izations that  is  entirely  overlooked,  and  that  is  the  waste 
of  ambitious  men.  Many  factory  employees  are  entirely 
blind  to  their  own  future  in  an  organization,  not  that 
they  want  to  be,  but  the  management  has  never  taken 
upon  itself  the  initiative  of  describing  what's  ahead  for 
them.  One  company  has  a  definite  policy  of  telling  each 
man  what's  ahead  of  him.  This  policy  comes  about  as 
a  result  of  the  personal  point  of  view  of  the  head  of  the 
organization.  In  another  concern  the  rise  of  each  exec- 
utive in  the  organization  is  pictured  to  the  men  in  an 
endeavor  to  show  the  possibilities  ahead  of  each  one  of 
them.  In  a  Massachusetts  factory  the  employment  man- 


CUTTING  LABOR  TURNOVER  COSTS         101 

ager  makes  this  a  part  of  his  program  in  employing  new 
men,  telling  them  frankly  what  they  can  expect.  This 
has  the  effect  not  only  of  spurring  men  on,  but  also  the 
statement  is  made  so  conservative  that  men  are  not  hired 
under  false  pretenses  and  therefore  doomed  to  disap- 
pointment later. 

The  intangible  wanderlust,  particularly  in  the 
younger  men,  is  a  larger  factor  than  ever  in  labor  turn- 
over when  jobs  are  plentiful.  Sometimes  a  man's  crav- 
ing for  a  change  may  be  satisfied  by  shifting  him  to 
another  department.  One  concern  with  factories  in  dif- 
ferent parts  of  the  country  holds  those  of  its  men  who 
have  the  roving  spirit  by  transferring  them  from  one 
plant  to  another  upon  request,  wherever  possible. 

But  in  most  plants  it  is  a  combination  of  policies  and 
plans  that  serve  to  hold  men  threatened  with  the  wan- 
derlust, rather  than  any  one  plan.  Home-owning  and 
building  plans  may  be  a  factor  in  holding  the  older 
men,  but  have  little  appeal  to  the  young  employee.  The 
development  of  a  shop  spirit  akin  to  a  wholesome  college 
spirit  is  often  a  factor  in  holding  young  men.  Pensions, 
profit  sharing,  bonuses  and  opportunities  to  buy  the 
company's  stock  also  have  an  influence  in  holding  men 
who  are  tempted  to  go  elsewhere  merely  to  get  a  change. 

Of  course,  no  matter  what  plan  you  adopt,  it  should 
normally  be  one  which  will  work  out  for  the  greatest 
good  of  the  majority  of  your  employees.  In  every 
organization,  no  matter  how  large  or  how  small,  there 
will  usually  be  found  some  workers,  who,  however  un- 
thinkingly or  unknowingly,  seem  selected  by  a  perverse 
fate  to  act  as  stumbling  blocks  to  the  unqualified  success 
of  any  plan.  Happily,  however,  this  class  comprises  but 
a  small  minority  and  the  employer  who  devises  a  plan 
which  holds  and  satisfies  a  majority  of  his  workers, 


102  HOLDING   MEN 


usually  has  good  reason  to  call  that  plan  a  success. 
Types  of  employees  differ  as  do  the  characters  of 
factory  organizations.  Plans  that  work  well  in  one 
plant  may  have  no  success  in  another  where  conditions 
are  different.  But  out  of  the  range  of  plans  outlined 
here  are  there  not  some  that  fit  your  particular  case? 
Failure  to  adopt  some  means  of  combating  labor  turn- 
over is  going  to  continue  to  emphasize  "The  High  Cost 
of  Labor  That  Comes  and  Goes." 


WHATEVER  success  I  have  made  during  my 
as  a  manufacturer  I  attribute  to  my  close  application 
to  details  and  to  my  careful  selection  of  competent  men. 
Also  it  has  been  due  to  a  large  extent  to  my  determination 
always  to  build  an  article  upon  honor  and  to  give  the  greatest 
value  possible  for  a  dollar.  This  I  have  tried  to  accomplish 
not  by  asking  workmen  to  work  for  less  than  a  reasonable  pay, 
but  by  economizing  in  other  directions — chiefly  on  nonpro' 
ductive  labor  and  overhead  expense" 

C.  W.  Nash, 

President,  Nash  Motors  Coraponv 


X 

KEEPING  IN  TOUCH  WITH 
JOHN  AND  JIM 

The  Views  of  63  Executives,  with  an  Introduction  by  William  Cordes, 
General  Manager  of  the  Florence  Manufacturing  Company 

A  STRETCH  of  low  meadow  not  yet  very  exten- 
sively built  upon,  separates  Florence,  a  suburb  of 
Northampton,  Massachusetts,  from  the  city  itself.  Flor- 
ence has  a  "center"  of  its  own,  churches,  a  public  hall, 
a  library  and  so  on.  Three  large  industries — one  a 
tooth  brush  plant — and  a  few  smaller  ones  have  always 
kept  everybody  in  the  growing  community  employed 
and  make  it  an  economic  unit.  The  population  is  there- 
fore old-established  and  well  mixed,  a  closely  knit  social 
unit. 

Everybody  rubs  elbows  with  everybody  else,  attends 
the  same  churches,  has  graduated  from  the  single  gram- 
mar school.  Probably  in  no  manufacturing  town  does 
the  industrial  citizenry  excel  that  of  Florence.  Intelli- 
gence, character,  and  the  social  instinct  have  but  to  be 
let  loose  in  such  surroundings  to  produce  a  compelling 
social  force. 

"Yet  we  were  not  getting  in  the  factory  the  benefit 
of  all  that  social  force,"  says  William  Cordes,  Treasurer 
and  General  Manager  of  the  Florence  Manufacturing 
Company,  the  tooth  brush  factory  of  the  town.  "Our 
lately  deceased  former  manager  was  a  fine  man.  He  had 
a  big  heart  and  would  do  anything  for  his  employees  in 
a  crisis.  Yet  he  lacked  the  ability  to  express  his  depth 


104  HOLDING   MEN 


of  heart  in  little,  simple,  constant,  everyday  ways.  He 
called  us  together  one  day  fifteen  years  ago,  those  of 
us  who  were  nearest  to  him,  over  in  the  old  office. 
'Boys,'  he  said,  'we  need  some  young  blood.  This  insti- 
tution is  in  danger  of  dying  from  dry  rot.'  The  partic- 
ular breed  of  young  blood  he  had  in  mind  was  that 
which  could  coordinate  the  energy  and  spirit  of  every 
one  in  the  factory.  He  was  a  natural  born  gentleman. 
But  he  was  modern.  In  today's  language,  his  idea  was 
that  a  good  factory  is  a  self-starter;  that  vim  in  the 
body  of  the  machine  is  worth  a  lot  more  than  vim  in  the 
crank-handle;  that  the  chauffeur's  business  was  rather 
to  see  that  all  the  members  of  the  organization  work  in- 
telligently together  than  to  pull  the  whole  organization 
himself  or  kick  it  along. 

' '  I  think  that  even  a  piston  would  like  to  know  why  it 
is  moving.  Certainly  any  man,  whether  manager  or 
foreman  or  machine  operative,  would  rather  work  intel- 
ligently than  in  the  dark.  He  works  more  easily,  gets 
more  positive  results,  with  less  subtracted  for  waste, 
plus  an  occasional  inspiration.  Also,  brains  are  like 
sources  of  water  power ;  they  may  be  there,  but  in  gen- 
eral they  don't  come  out  and  do  work  unless  they  and 
the  personality  behind  them  are  recognized.  It  is  easy 
to  explain  methods  and  ends  to  department  heads  or  to 
foremen.  But  even  if  you  had  the  time,  it  is  impossible 
to  explain  purposes  and  methods  to  the  entire  rank  and 
file — neither  a  bookkeeper  nor  a  machinist  can  gain  each 
other's  or  your  viewpoint  in  a  minute.  The  only  thing 
which  can  take  the  place  of  complete  detailed  knowledge 
of  whys  and  wherefores  throughout  the  factory  is  a 
general  knowledge  of  the  personality  of  the  company's 
executives,  a  sort  of  faith  in  them,  which  can  only  be 
gained  by  personal  intercourse. 


DOES  PERSONAL   CONTACT  PAY?  105 

'We  were  urged  to  show  whatever  social  spirit  was 
in  us.  The  Commodore,  as  we  loved  to  call  the  manager, 
promised  that  he  would  do  his  best  to  follow  our  exam- 
ple. He  did  so,  and  eventually  won  a  great  deal  of  the 
social  ability — which  is  what  it  really  amounts  to — the 
lack  of  which  he  had  formerly  deplored.  The  new  spirit 
soon  spread  to  the  foremen,  and  expressed  in  a  sec- 
ondary form  by  them,  reinforced  our  own  activities 
also.  Things  went  along  more  comfortably  and  better. 
Since  then  every  improvement  has  been  in  the  direction 
of  more  personality  in  the  factory.  We  have  not  by  any 
means  '  died  of  dry  rot. ' 

PERSONAL   contact  between  employer  and  workers 
makes  for  an  excellent  esprit  de  corps,  and  this  in 
turn  leads  to  more  and  better  production. 

"The  matter  of  obtaining  a  closer  personal  contact 
is  resolved  into  three  questions.  First,  how  far  a  man- 
ager should  unite  his  personality  with  the  business.  But 
that  is  easily  solved,  because  a  manager  is  the  personal 
expression  of  the  business  or  corporation.  He  cannot 
dodge  being  so,  neither  can  the  company,  and  both 
should  get  the  benefit,  as  well  as  the  responsibility,  of 
his  representation. 

"Second,  there  is  a  fear  that  certain  psychological 
reactions  detrimental  to  the  work  would  result  from  too 
close  relations  between  employer  and  employee.  But  if 
a  manager  choose  to  be  very  reserved,  he  will  have  to 
take  the  inevitable  results.  An  employee  will  shrink 
from  giving  any  extra  interest  to  his  work,  because  he 
thinks  that  in  an  exchange  of  sentiment  he  would  be 
flim-flammed  by  an  employer  who  has  no  reciprocal 
interest  in  him.  You  have  heard  this:  'Why  should  I 
do  anything  for  him — what  does  he  care  for  me?'  Or, 


106  HOLDING   MEN 


'What  does  the  company  care  for  me?'  This  attitude 
of  mind  becomes  a  habit  and  is  apt  at  any  critical 
moment  to  cause  loss  which  cannot  be  measured  in 
dollars  but  is  an  index  of  a  constant  indefinite  loss.  On 
the  other  hand,  I  found  a  foreman  a  few  days  ago  laying 
out,  months  in  advance,  a  design  for  a  next  year's  style. 

"As  soon  as  it  is  found  that  the  main  result  of 
expressed  good  will  is  of  benefit,  a  way  will  be  found  to 
control  the  by-products.  These  reactions  naturally  de- 
pend upon  the  characters  of  both  employer  and 
employees.  But  these  characters  are  not  ossified,  or  even 
static ;  they  are  dynamic,  and  will  be  themselves  molded 
and  changed  during  interaction  so  as  to  work  more 
easily  toward  the  desired  results. 

"Third,  the  limitations  and  limits  of  the  application 
of  this  policy.  At  this  factory  our  relations  within  the 
circle  of  foremen  are  very  close.  I  know  a  great  deal 
about  some  of  my  foremen's  business  and  private  affairs, 
such  as  sickness,  deaths  and  personal  home  life.  There 
are  no  limits  to  the  spirit  and  practice  of  social  good- 
feeling  except  those  of  sincerity  on  the  one's  part  and 
comprehension  on  the  other's.  I  would  not  force  the 
extension  of  personal  relations  to  anyone  who  is  unwill- 
ing or  distrustful.  We  had  demonstrated  to  us  in  our 
own  plant  the  advisability,  almost  necessity,  and  subse- 
quently the  benefit,  of  a  greater  personal  contact  with 
the  men. 

"We  have  had  to  import  a  great  deal  of  help  from 
outside  of  town,  due  to  a  sudden  unrest,  probably 
caught  from  the  munitions  industries  nearby,  which 
happened  to  come  just  before  a  large  expansion  of  our 
plant.  The  increase  to  450  workers  therefore  amounts, 
from  a  personal  contact  viewpoint,  to  an  increase  much 
larger,  and  faces  us  with  the  problems  of  a  bigger  plant. 


DOES  PERSONAL  CONTACT  PAY?  107 

It  is  somewhat  like  starting  all  over  again.  Now  some 
of  these  men  are  'floaters,'  who  have  worked  in  all  sorts 
of  places  under  all  sorts  of  men.  It  is  a  point  of  pride 
or  instinct  with  many  of  them  never  to  take  a  man  or  a 
word  at  face  value.  The  best  thing  to  do  with  them  is 
to  leave  them  severely  alone.  Some  of  them  will  go 
away,  because  they  are  built  to  go.  Those  who  will  stay 
are  fast  being  silently  taught  by  the  esprit  de  corps  of 
the  factory,  the  spirit  of  good  fellowship  which  makes 
for  a  united  energy  in  getting  out  the  best  and  most 
product." 

What  Mr.  Cordes  has  written  concerns  his  manage- 
ment views  in  general  and  specifically  how  they  work 
out  at  the  Florence  Manufacturing  Company  located 
amidst  perhaps  an  average  small-town  environment. 
How  near  these  views  check  with  average  management 
opinions  on  the  human  factor  may  be  seen  from  a  review 
of  the  answers  factory  executives  gave  to  a  list  of  ques- 
tions sent  them.  The  questionnaire  form  which  was  sent 
out  is  reproduced  on  page  109.  It  may  be  interesting  to 
take  up  the  questions  asked,  one  by  one,  and  see  just 
how  these  63  factory  managers  have  answered  them. 

In  the  first  place  there  is  the  main  question,  ' '  Do  you 
see  value  in  retaining  a  personal  contact  with  your 
employees  ? "  Is  it  not  a  significant  fact  and  a  credit  to 
modern  management  that  only  one  executive  out  of  the 
63  who  answered  had  a  negative  reply?  It  is  only  fair 
to  say  that  many  of  the  sets  of  questions  sent  out  were 
not  returned  and  very  likely  some  of  these  fell  into  the 
hands  of  executives  who  see  no  value  in  the  development 
of  a  closer  personal  contact  between  manager  and  men. 
Because  of  a  feeling  that  all  the  rest  of  the  questions 
hinged  upon  an  affirmative  answer  to  this  first  one,  some 
of  these  executives  may  have  withheld  their  negative 


108  HOLDING    MEN 


answers.  On  the  other  hand  it  is  likely  that  many  of 
those  who  did  not  reply  were  prevented  from  doing  so 
for  other  reasons  and  would  have  answered  "yes." 
"Decidedly"  is  the  answer  two  men  give,  and  one 
adds,  "The  big  problem  today  in  large  organizations." 
"Yes,"  the  superintendent  of  a  shoe  supply  factory 
says,  "If  an  employee  believes  he  is  working  for  a  man 
and  not  for  a  soulless  corporation  he  does  better  work 
other  things  being  equal. ' ' 

EKE   many  other  methods   personal   contact   may  be 
overdone.     Consider  it  from  a  business  standpoint, 
and  don't  let  employees  mistake  it  for  preference. 

Some  of  the  affirmatives  were  qualified.  "Yes,  to  a 
certain  extent,"  one  reply  reads.  Another  says,  "Yes, 
but  care  must  be  taken  not  to  obtain  a  wrong  impres- 
sion." To  the  second  question,  "Do  you  see  a  danger 
of  overdoing  this.  If  so,  in  what  way?"  some  interest- 
ing answers  came.  Of  the  57  who  answered  the  first 
part  of  this  question  43  saw  a  danger  of  overdoing  the 
development  of  a  closer  personal  contact  with  the  work- 
men, while  fourteen  saw  no  reason  for  the  exercise  of 
restraint.  Of  these  fourteen  one  pottery  company  exec- 
utive does  "not  believe  this  will  be  overdone  by  a  pru- 
dent manager."  A  Connecticut  manager  says,  "Not  if 
a  reasonable  amount  of  dignity  is  maintained,"  and  two 
others  contribute  practically  the  same  thought  in  exactly 
the  same  words,  "Not  if  good  judgment  is  used."  "Not 
if  you  are  simply  friendly  and  not  too  intimate,"  "No 
danger  if  common  sense  is  used,"  add  two  more 
thoughts  to  the  discussion. 

The  production  manager  of  an  Illinois  company  bal- 
ances the  question  well  in  this  answer,  "Not  as  long  as 
this  contact  smacks  of  business  only,  that  is,  of  the  wel- 


DOES  PERSONAL  CONTACT  PAY?  109 


Retaining  Personal  Contact  With  Tour  paployeeg 

U    Do  Ton  t*e  value  la  retaining  a  personal  contact  with  your  employees?. 

2.  Do  yon  see  a  danger  of  overdoing  this?    If  so,  in  what  way?  y^  '• 

/  /         fl 

3.  flf  your  organization  is  too  large  for  you  to  know  each  man  personally,  what  methods 
have.  yon.  fer  keeping  in  personal  touch  with  the  men  through  your  subordinates? 

rl4ff~     tfro    J&ViJUQ - 

cT 

4.r  If  you  make  a  practice  of  going  over  your  plant  or  Jj:ore  reeularly_,when  and/how 
'  often  do  you  do  it?f^£fr  pp  "/«'>»»tfA  c\  &4*-f0J!> —  x^vtA^fr/',/   ~^f^  _  jLArr^t^ 


5.  Do  you^teel  that  there  is  advantage  jln  this  proced 
viewpoint?    ^/-^  *""   ^t^'-f/^ 

6.  Do  you  include  among  the  reports  that  you  insist  on  receiving  notices  of  promo- 
tions of  everyone  in  the  organization? 


/rt  A  JleMr  csAtfc  lei  fl}\. 

-         ---—*. 


7.  Do  you  mafea  it  a  point  to  have  a  word  to  say  to  the  man  promoted' 
6.  Do  you  agree  that  there  is  value  in  a  sincere  word  of  this  sort?. 


9.  Some  managers  wish  to  be  informed  of  sickness,  deaths,  new  arrivals,  and  other  im- 
I  portant  events  In  the  lives  of  employees  s 
What  limitationc  do  you  see  to  this  plan?_ 


l  portant  events  in  the  lives  of  employees  so  tha^they  can  teke  proper  notice  of  it. 

f^j^r-rv  P       . 


10.  How  far  up  in  an  organization  do  you  think  the  plan  mentioned  In  the  previous  ques-' 
tion  can  be  carried  and  not  snacJc  of  inslneerity?r4T? 


11.  Do  you  see  value  in  the  policy  of  the  chief  executive  wlm  has  "walk-ln"^printed 
his  office  door  for  all  who  read  it  dovm  to  the  porter?   iJs/)  —  IfaAA.  t/srrfi    Is 


porte 
12,  Vhat  objections  do  you  Siee  to  such  a  plan? 


IS.  One  employer  not  long  ago  gave  a  dinner  to  the  einployees  who  had  been  with  him  for 
forty  years.    What  similar  plans  have  sou  carried  out  to  nake  your  men  feel  that 
you  are  all  in  one  large  family?      li/-e_eJ>zAAjt-  ^-H-g-fcfe^-.^^-/y  /efovm^-t- 

C/^  (J          UU 


14.  Do  you  believe  athletic  association  events,  plonics,  and  so  on  have  a  value  froa 
the  personal  relationship  viewpoint?    What  is  your  experience? 


IF  yon  PREFER,  DISKEOARD  THESE  QUESTIONS  AHD  DICTATE  A  LETTEB  IH  BEPLY 
Titl. 


0  ~/j  ly 


FORM  I:     Here  is  the  question  sheet  filled  out  by  the  63  executives  on 

whose  answers  this  chapter  is  based.     In  some  cases  the  executives  were 

to  interested  in  making  their  views  known  that  they  took  time  to  dictate 

letters  supplementary  to  the  questionnaire 


110  HOLDING    MEN 


fare  of  the  individual  from  strictly  a  business  stand- 
point, otherwise  I  would  say  that  it  may  become  very 
detrimental. ' ' 

Of  those  who  feel  that  there  is  danger  in  overdoing 
this  phase  of  management  it  may  be  interesting  to 
.analyze  the  reasons  given.  Eighteen  believe  that  over- 
familiarity  is  to  be  guarded  against.  Eight  think  that 
workmen  will  take  undue  advantage  and  an  equal  num- 
ber believe  that  a  loss  of  respect  for  superiors  may 
result.  Five  are  of  the  opinion  that  favoritism  is  apt 
to  be  shown.  Two  think  that  although  such  plans  are 
good  they  will  over-emphasize  the  value  of  individuals. 

Fear  of  over-familiarity  seems  to  be  much  the  largest 
warning  to  heed  according  to  this  ballot.  This  is  ex- 
pressed in  a  number  of  different  ways,  some  of  which 
are  so  indicative  of  the  thought  put  on  the  question  that 
it  may  be  worth  while  to  set  down  a  few  of  them  here. 
"By  getting  too  personal.  Works  both  ways."  "Em- 
ployees may  try  to  become  too  familiar,  and  begin  to 
feel  that  'getting  on  the  right  side  of  the  boss'  is  more 
advantageous  than  doing  effective  work."  "Personal 
contact  can  be  overdone  by  getting  '  chummy '  and  lax. ' ' 
"Lack  of  appreciation  or  misunderstanding  the  motive." 
"Most  workmen  can't  have -too  much  familiarity  with 
the  firm  and  still  keep  their  places. "  "  The  contact  must 
not  be  too  intimate.  Talk  of  work  only."  "Too  much 
familiarity  is  apt  to  cause  jealousy."  "Familiarity 
breeds  contempt."  "Too  much  familiarity  causes 
slackening  of  discipline  when  a  rush  comes. ' '  A  thought 
along  similar  lines  is  that  of  Stephen  B.  Mambert,  Vice 
President  and  Financial  Executive  of  Thomas  A. 
Edison,  Inc.,  who  writes,  "Yes,  extreme  care  must  be 
exercised  not  to  carry  personal  contact  to  the  point 


DOES  PERSONAL   CONTACT  PAY?  Ill 

where  it  causes  some  individuals  to  feel  that  they  are 
in  a  preferred  class." 

' '  Too  much  attention  cannot  be  paid  to  the  subject  of 
personal  contact  with  employees,"  is  the  opinion  of 
George  A.  Sagendorph,  general  manager  of  the  Penn 
Metal  Company.  "Of  course,"  he  says,  "it  may  be 
overdone,  and  you  will  find  at  times  people  who  will  take 
undue  advantage  of  your  good  intentions,  but  the  ulti- 
mate value  of  work  along  this  line  can  readily  be  seen 
by  anyone  who  has  followed  it  intelligently  for  even  a 
short  space  of  time. ' ' 

This  really  sums  up  the  opinion  of  practically  all.  It 
is  only  cases  of  individual  workmen  that  managers  have 
in  mind  when  they  speak  of  the  danger  of  overdoing 
the  cultivation  of  a  closer  personal  contact  with  em- 
ployees. This  is  evidenced  by  the  fact  already  men- 
tioned that  all  but  one  who  sent  answers  see  value  in 
close  relations.  Several  feel  that  lack  of  respect  for 
superiors  will  follow  unless  properly  handled  but,  as  an 
executive  prominent  in  the  Packard  Motor  Car  Com- 
pany says,  "This  can  be  avoided  by  tact  on  the  part  of 
the  head  of  a  business.  Naturally  in  order  to  obtain 
discipline,  the  minor  officials  who  have  direct  charge  of 
the  work,  must  have  the  respect  of  the  men.  If  the  men 
felt  that  they  could  go  over  the  heads  of  minor  officials 
there  would  be  danger. ' ' 

Another  angle  on  the  same  thing  is  brought  out  by 
L.  J.  Vorhees,  works  manager  of  the  Providence  Manu- 
facturing and  Tool  Company.  He  says,  "When  an  em- 
ployer carries  this  to  such  an  extent  that  it  becomes  dis- 
tasteful to  the  employee  or  lowers  his  standards  in 
attempting  to  meet  the  employee  on  his  level  to  such  an 
extent  the  employee  loses  respect  for  the  employer." 
Care  to  avoid  favoritism  and  the  consequent  growth  of 


112  HOLDING    MEN 


jealousy  among  the  men  apparently  is  also  necessary 
in  good  management. 

Two  of  these  63  factory  executives  who  favor  close 
personal  contact  with  employees  feel  that  unless  han- 
dled wisely  it  will  give  the  men  a  sense  of  over-impor- 
tance, encourage  the  magnifying  of  trifles,  and  add  to 
the  burden  of  executive  duty. 

The  third  question  asked  was  the  following,  ' '  If  your 
organization  is  too  large  for  you  to  know  each  man  per- 
sonally what  methods  have  you  for  keeping  in  personal 
touch  with  the  men  through  your  subordinates?"  Of 
those  whose  organizations  were  of  sufficient  size  to  come 
under  this  question  55  per  cent  reported  that  they  accom- 
plished results  through  assistants.  Another  group  felt 
that  they  had  succeeded  in  retaining  a  personal  contact 
through  foremen's  meetings.  A  third  and  smaller  group 
were  of  the  impression  that  a  close  perusal  of  well-kept 
employees'  records  was  a  good  method  to  follow. 

WHY  the  department  managers  and  foremen  should 
be  trained  to  act  as  mediums  through  which  the 
executive  head  can  keep  in  close  touch  with  his  men. 

When  an  organization  growsi  beyond  the  stage  where 
the  head  of  the  business  can  know  the  individual  work- 
men the  answers  seem  to  indicate  that  the  foreman  is 
generally  relied  upon  to  retain  the  desired  personal 
contact  with  the  men.  Whether  or  not  this  is  successful 
is  open  to  question.  Dean  Marquis  of  the  Ford  Motor 
Company  has  said,  and  many  agree  with  him,  that  it  is 
comparatively  simple  to  get  management  policies  to 
filter  down  an  organization  to  the  foremen.  But  here 
they  are  quite  likely  to  stop.  If  this  is  true  in  a  general 
way  isn't  it  doubtful  whether  the  desired  sort  of  per- 
sonal contact  is  being  obtained  by  way  of  the  foremen  ? 


DOES   PERSONAL  CONTACT  PAY?  113 

One  interesting  reply  from  a  large  silver  manufactur- 
ing concern  contained  this,  "Our  employment  man 
spends  all  his  time  when  not  actually  interviewing  appli- 
cants, in  going  round  the  factory  and  finding  out  how 
men  recently  hired  are  getting  along  with  their  work." 
This  procedure  must  have  the  effect  of  making  a  new 
man  feel  that  he  has  a  very  definite  relationship  with 
the  management. 

Harry  Franklin  Porter,  organization  engineer,  De- 
troit Executives  Club,  contributes  these  suggestions  that 
are  worth  thinking  over,  "Keep  efficiency  records  of 
each  man.  Train  immediate  supervisors  to  take  a 
personal  interest.  Have  a  department  to  which  the  men 
may  go  freely. ' '  Also  of  interest  is  the  following  state- 
ment of  the  superintendent  of  a  large  knitting  mill, 
"When  our  factories  outgrew  the  'small  factory  idea7 
I  started  to  surround  myself  with  the  brainy  depart- 
ment heads.  I  keep  in  touch  through  them. ' '  One  New 
Jersey  executive  says,  "I  invariably  make  it  a  point  to 
inquire  about  new  men  and  make  their  acquaintance  by 
direct  approach."  "Acquaintance  is  automatically 
made  through  applications  for  wage  increase  and 
changes  of  work,"  one  Connecticut  manager  adds. 
From  Thomas  A.  Edison,  Inc.,  comes  this  interesting 
answer,  "By  a  combination  of  staff  and  line  organiza- 
tion— the  line  organization  keeps  up  the  personal 
touch." 

Practically  every  manager  who  answered  has  a  policy 
of  going  over  the  plant  fairly  regularly.  Many  seem  to 
have  the  opinion  of  one  production  engineer  who  says, 
"It  is  a  good  plan  to  do  this  and  to  talk  with  individ- 
uals, thus  getting  their  viewpoint.  Often  troubles  will 
come  to  your  attention  that  you  never  knew  existed  and 
which  you  could  never  discover  any  other  way." 


114  HOLDING   MEN 


By  far  the  greater  number  make  this  trip  as  often  as 
once  a  day;  in  fact,  four-fifths  of  those  who  answered 
question  four  go  that  frequently.  One  said  he  made  a 
trip  as  often  as  once  an  hour  at  certain  times.  In  mak- 
ing these  trips  there  seems  to  be  a  desire  to  go  by  differ- 
ent routes  or  at  a  different  time  of  day  so  as  to  preclude 
any  possibility  of  the  men  anticipating  a  visit.  ' '  Unless 
you  do  this,"  one  man  says,  "you  won't  see  the  general 
run  of  things." 

Only  two  managers  fail  to  see  a  value  from  the  per- 
sonal contact  viewpoint  in  such  trips  about  a  plant.  In 
fact,  such  phrases  as  the  following  were  used  in  answer- 
ing question  five,  "Decidedly,  the  men  feel  the  manage- 
ment is  taking  a  personal  interest  in  their  work."  "I 
know  there  is."  "Has  a  decided  advantage."  "Yes, 
makes  men  feel  their  individuality  is  not  lost  in  the 
multitude."  "Absolutely  yes."  "Decidedly  so."' 
"Most  assuredly."  "A  very  large  one."  "Yes,  from 
the  example  set." 

An  interesting  thought  is  added  by  the  works  man- 
ager of  a  Rhode  Island  concern  who  says  that  he  makes 
the  trips  often  enough  so  that  the  men  will  be  suffi- 
ciently accustomed  to  seeing  him  in  the  factory  so  that 
they  will  not  change  their  habits  or  methods  of  work 
when  he  passes  them.  Another  executive  adds,  "It  is 
decidedly  advantageous  for  the  men  to  know  the  head 
of  the  business  by  sight  at  least."  Still  another  feels 
that  he  keeps  in  better  touch  with  the  foremen  through 
these  trips. 

The  sixth  question  read,  "Do  you  include  among  the 
reports  that  you  insist  on  receiving  notices  of  promo- 
tions of  everyone  in  the  organization?"  Results  on  this 
question  show  that  much  the  greater  number  do  make 
it  a  point  to  know  about  all  promotions.  One  manager 


DOES  PERSONAL  CONTACT  PAY? 115 

who  sends  out  notices  personally  of  all  promotions  in 
the  plant  adds,  "but  I  always  make  mention  in  notify- 
ing the  men  of  promotions  that  they  are  at  the  recom- 
mendation of  the  foreman." 

Still  another  factory  executive  writes  in  answer  to 
this  question,  "I  certainly  do.  This  method  serves  to 
keep  you  in  close  touch  with  your  organization  and  is 
an  important  part  of  the  system. "  ' '  Yes,  even  increases 
in  wages  of  a  few  cents  per  hour,"  is  the  way  one 
Massachusetts  general  manager  answers.  "Certainly" 
and  "always"  seem  to  be  characteristic  replies  to  this 
question,  indicating  the  importance  of  handling  promo- 
tions in  this  way  where  the  size  of  the  organization  will 
permit.  But,  of  course  there  are  cases  where  this  is  not 
possible,  such  as  is  indicated  by  the  following:  "As 
our  plant  employs  12,000  men,  I  cannot  personally  talk 
to  all  the  men  promoted,  but  I  do  talk  to  all  men  pro- 
moted above  the  position  of  sub-foreman.  A  proper  talk 
to  a  man  at  the  time  he  is  promoted  by  the  executive 
head  of  the  business  is  of  the  greatest  importance.  There 
are  more  men  who  would  like  to  do  what  is  to  the  best 
interest  of  the  company  than  there  are  companies  who 
keep  them  so  informed." 

T71XTENDING  the  sphere  of  the  employer's  interest 
-L-J  in  his  men  into  their  home  life,  even  aiding  in 
sickness  or  financial  trouble,  is  favored  by  many  employers. 

Question  number  eight  naturally  received  about  the 
same  answer  as  did  seven.  One  was  a  matter  of  prac- 
tice and  the  other  belief  in  the  value  of  the  practice. 
"Some  managers  wish  to  be  informed  of  sickness,  death, 
new  arrivals  and  other  important  events  in  the  lives 
of  employees  so  that  they  can  take  proper  notice  of 
them.  What  limitation  do  you  see  to  this  plan  ? ' '  This 


116  HOLDING   MEN 


is  the  way  the  ninth  question  read.  About  half  of  those 
who  answered  were  in  sympathy  with  the  plan  and  a 
number  of  others  thought  it  a  good  idea  but  too  much 
of  a  time  consumer  or  difficult  of  attainment  in  a  large 
plant.  A  half  dozen  thought  it  smacked  of  paternalism, 
but  only  one  distinctly  did  not  believe  in  it. 

The  vice  president  in  charge  of  manufacturing  in  one 
large  company  says,  "If  it  were  possible,  I  believe  that 
in  the  case  of  sickness,  death  or  financial  trouble  a  repre- 
sentative of  the  firm  should  call  upon  the  employee  at 
his  home  and  assist  him  in  any  way  possible.  There 
is  nothing  in  my  judgment  that  would  be  of  greater 
stimulus  to  loyalty  than  sincere  help  and  thoughtful- 
ness  in  any  time  of  adversity."  It  is  suggested  by  one 
answer  that  the  company  house  organ  or  factory  paper 
should  take  note  in  its  news  columns  of  all  matters  of 
this  sort. 

An  important  point  from  the  utilitarian  angle  is 
brought  out  in  this  answer :  ' '  This  is  of  vital  importance, 
especially  the  report  of  sickness  and  absence.  I  believe 
that  each  absence  should  be  investigated.  For  my  per- 
sonal experience  in  these  investigations  which  I  always 
make  have  discovered  many  employees  who  have  been 
absent  on  account  of  headaches  caused  by  the  lack  of 
glasses,  poor  teeth,  abnormal  habits  and  so  on.  I  have 
been  able  to  correct  a  good  many  cases,  not  only  reliev- 
ing the  patient  of  suffering  but  making  the  employee  far 
more  efficient." 

C.  F.  Hathaway  and  Sons  say  that  flowers  and  per- 
sonal calls  are  important  in  cases  of  sickness  and  death 
and  each  new  arrival  receives  five  dollars  to  start  a  bank 
account.  One  solution  of  the  plan  is  that  suggested  by 
a  manager  in  these  few  words:  "I  keep  in  touch  with 
the  health  of  department  heads  and  they  with  others. 


DOES  PERSONAL  CONTACT  PAY? 117 

The  service  department  does  the  rest."  As  defining  the 
limitations  of  the  plan,  one  manufacturer  says  that  they 
are  at  the  point  where  the  personal  overshadows  busi- 
ness relationships.  Another  manager  would  limit  any 
action  to  the  spoken  word. 

Questions  eleven  and  twelve  brought  some  interesting 
answers  as  there  were  divided  opinions.  The  questions 
read:  "Do  you  see  a  value  in  the  policy  of  the  chief 
executive  who  has  'walk  in'  printed  on  his  office  door 
for  all  who  read  it,  down  to  the  porter?  What  objec- 
tion do  you  see  to  such  a  plan  ? ' '  Many  took  the  ques- 
tion literally  and  so  while  in  sympathy  with  what  might 
be  called  "an  open  door  policy"  did  actually  suggest 
leaving  the  office  door  open  rather  than  labeling  it 
"walk  in."  Of  course,  what  was  intended  of  these  two 
questions  was  to  bring  out  the  value  of  having  men 
feel  that  they  had  access  to  the  head  of  their  firm  as  a 
matter  of  course.  "Certainly"  is  the  answer  a  Massa- 
chusetts manager  gives,  "Any  executive  handling  men 
should  be  approachable  and  known  to  be  so."  An  in- 
teresting point  is  made  in  the  letter  written  by  A.  S. 
Bond,  President  of  the  Packard  Piano  Company,  who 
says:  "This  sign  amounts  to  nothing  unless  the  execu- 
tive has  the  confidence  of  his  employees,  and  having  that 
he  does  not  need  any  such  sign." 

Several  suggested  that  this  policy  was  a  wise  one, 
although  it  was  subject  to  abuse  unless  checked  in  some 
way.  Checking,  however,  may  exactly  defeat  the  pur- 
pose of  the  plan.  This  is  overcome  in  one  Boston  fac- 
tory by  having  it  understood  that  employees  who  fail  to 
get  satisfaction  in  taking  the  matter  up  with  their  super- 
visor are  at  liberty  to  come  to  the  manager  with  it. 

On  the  other  side  of  the  question  such  answers  as  this 
were  received.  "No  value  absolutely."  "No!  Work- 


118  HOLDING   MEN 


men  feel  that  the  sign  does  not  apply  to  them."  "Let 
action  speak."  "Bunk.  Looks  like  a  bluff  and  is." 
Question  thirteen  was  asked  with  the  idea  of  bringing 
out  various  special  plans  for  bringing  workmen  in  closer 
contact  with  the  management.  It  read,  "One  employer 
not  long  ago  gave  a  dinner  to  employees  who  had  been 
with  him  for  forty  years.  What  similar  plans  have  you 
carried  out  to  make  your  men  feel  you  are  all  in  one 
large  family?"  Picnics  and  outings,  profit  sharing 
plans,  dinners,  dances,  clubs,  smokers  and  athletic  events, 
share  about  alike  in  the  answers.  Of  the  47  factory 
executives  who  answered  question  fourteen,  "Do  you 
believe  athletic  association  events,  picnics  and  so  on 
have  a  value  from  the  personal  relationship  viewpoint  ? ' ' 
only  six  answered  in  the  negative  and  one  other  was 
doubtful.  The  president  of  one  concern  rather  pessi- 
mistically writes  that  it  organizes  employees  for  the 
agitators.  Another  man  without  giving  reason  says,  ' '  I 
believe  they  do  more  harm  than  good."  The  general 
thought,  however,  is  that  expressed  by  one  man  in  these 
words,  "I  thoroughly  believe  in  athletic  organizations 
and  picnics  as  a  great  stimulus  to  a  better  understanding 
among  the  employees  and  a  better  knowledge  of  each 
other." 


THE  great  thing  is  not  only  to  make  the  man  working  for 
wages  actually  a  partner  interested  with  the  employer, 
but  to  let  him  show  that  he  has  such  a  relation  and  that  hi» 
welfare  and  the  welfare  of  the  employer  are  identical.     Whem 
this  basis  is  established  most  differences  will  solve  themselvet. 

JAMES  A.  FARRELL, 
President  of  the  U.  S.  Steel  Corporatio* 


PART  III-BREAKING  IN 
AND  DEVELOPING  MEN 

Founding-  a  Business 

T  TNDER  the  building  recently  erected  by  But- 
^  ler  Brothers  stand  one  hundred  and  ninety- 
two  caissons,  six  feet  in  diameter,  extending1  down 
to  hardpan  seventy- five  feet  below  the  basement. 

If,  before  the  superstructure  was  erected,  the 
earth  had  been  excavated  from  about  these  cais- 
sons, they  would  have  appeared  like  a  forest  of 
huge  concrete  columns  rising  high  in  the  air. 
And  yet,  as  one  looked  upon  the  work  just  be- 
fore the  basement  was  walled  in,  he  saw  no  evi- 
dence of  caissons;  only  the  trampled  pit.  There 
was  nothing  in  sight  to  indicate  the  mighty  lift- 
ing power  that  had  so  patiently  been  prepared 
for  the  lofty  structure  to  come. 

And  thus  it  is  with  a  great  business,  although 
the  unthinking  man  does  not  appreciate  this  fact. 
He  tries  to  build  a  business  upon  the  shallow 
foundation  which  he  sees,  without  providing  cais- 
sons that  go  down  to  the  solid  rock.  He  over- 
looks the  fact  that  back  of  and  under  every  great 
success  there  are  years  of  right  thinking  and 
right  doing — cemented  columns  of  honest  effort 
and  honest  dealing — which,  like  massive  piers  of 
concrete,  will  sustain  that  business  from  genera- 
tion to  generation. 


EDWARD  B.  BUTLER 

Chairman  of  the  Board  of  Directors  of  Butler  Brothers 


XI 

FITTING  INSTEAD 
OF  FIRING  MEN 


By  W.  S.  Ball 
Baaed  on  an  Extensive  Investigation 


NOTHING  but  firing  would  do  for  Johnson,  the  fore- 
man was  sure.  But  the  superintendent  looked 
doubtful.  He  explained  that  Johnson  had  been  with 
the  firm  a  good  while,  and  had  been  considered  one  of 
its  best  men.  All  this  was  true,  the  foreman  admitted, 
but  in  spite  of  it  he  insisted  that  the  ''grouch"  which 
Johnson  had  been  showing  of  late  was  becoming 
expensive. 

"It  wouldn't  be  so  bad  if  only  Johnson  was  affected 
by  it,"  he  explained.  "But  it's  affecting  the  others. 
You  can't  keep  a  department  running  when  one  of  the 
oldest  men  in  it  gets  sulky  and  soldiers  on  his  job. " 

"Perhaps  it's  something  he'll  get  over,"  suggested  the 
superintendent,  "family  troubles,  or  something  like 
that." 

"I've  asked  about  that  from  those  who  know  him," 
said  the  foreman.  "There  isn't  a  thing  that  I  can  find 
out  to  account  for  it.  I  hate  to  let  him  go,  but  I  don't 
see  any  other  way." 

The  superintendent  pondered  the  case  a  minute. 

"Perhaps  we'll  have  to,"  he  finally  agreed.  "But 
Johnson  has  been  too  good  a  man  to  drop  in  a  hurry. 
Suppose  you  keep  him  on  for  another  week.  I'll  think 
it  over." 


DEVELOPING   YOUR   MEN 


Now  the  interesting  thing  about  this  incident  is  that  it 
could  really  happen  at  all.  Ten  years  ago  —  five  years  in 
many  shops  —  there  would  have  been  no  hesitation  at  all 
about  ''firing"  Johnson.  A  workman  who  developed 
faults  that  outweighed  his  usefulness  had  short  shrift. 
Workers  were  usually  plentiful;  why  bother  with  one 
who  presented  a  personal  equation  that  had  to  be  solved 
individually  ? 

But  employers  are  coming  to  realize  that,  even  if  no 
other  motive  were  involved,  it  costs  money  to  break  in 
new  workers.  More  attention  than  ever  before  is  being 
paid  to  the  hiring  of  men,  in  order  to  secure  those 
adapted  to  the  work,  that  the  waste  of  misfits  may  be 
avoided.  Similarly,  "firing"  is  not  the  light  affair  that 
it  was  once  supposed  to  be. 

NOWADAYS  firing  is  being  considered  as  scientific 
colly  as  hiring,  and  faults  are  "cured"  before  the 
worker  becomes  a  candidate  for  the  "blue  ticket". 

Modern  efficiency  believes  in  curing  faults,  if  pos- 
sible; in  teaching  those  who  are  teachable;  in  transfer- 
ring from  one  kind  of  work  to  another  until  the  round 
peg  fits  the  round  hole.  "Firing"  is  regarded  as  a  last 
resort,  reserved  for  certain  flagrant  sins  or  incompetence 
that  have  persisted  through  numerous  opportunities. 

This  means  that  more  attention  than  before  is  being 
given  to  the  personal  side  of  industrial  discipline.  The 
man  who  is  skilful  in  handling  men  has  always  been  an 
asset  in  any  business,  but  today  he  finds  himself  in  still 
greater  demand.  And  many  a  worker  would  be  amazed 
to  know  the  efforts  that  are  made  by  his  superiors  to 
overcome  his  faults  or  to  bring  out  his  best  without 
resort  to  the  fabled  "blue  envelope."  For  this  kind  of 
discipline  no  fixed  rule  is  possible.  General  principles 


FITTING   INSTEAD   OF  FIRING 123 

must  be  modified  by  the  personal  factor  in  individual 
cases.  The  .skill  of  the  foreman  or  superintendent  is 
measured  by  his  ability  to  size  up  motives  and  the  forms 
of  appeal  that  are  most  likely  to  prove  effective.  As  a 
case  in  point,  consider  the  treatment  which  transformed 
Johnson,  whom  the  foreman  wanted  to  discharge. 

A  few  days  after  the  conversation  between  foreman 
and  superintendent,  the  latter  spent  some  time  in  the 
foreman's  department,  ostensibly  on  business  connected 
with  an  important  order  which  was  being  rushed 
through.  He  noticed  several  apprentices  working  in 
more  or  less  haphazard  fashion,  under  a  variety  of  tute- 
lage. Nominally,  they  were  responsible  to  the  foreman. 
Actually,  they  seemed  to  be  responsible  only  to  the  dic- 
tates of  their  own  ambition,  plus  the  authority  of  the 
nearest  journeyman,  for  the  foreman  had  little  time  to 
devote  to  instructing  them. 

Presently  there  was  another  heart-to-heart  talk  be- 
tween foreman  and  superintendent,  after  which  the 
foreman  made  for  Johnson.  "Mr.  Johnson,"  he  said, 
' '  I  'm  not  very  well  satisfied  with  the  way  those  appren- 
tice boys  are  getting  along.  They  bungle  through  their 
work  and  there  isn't  anybody  in  particular  to  see  that 
they  learn  what  they're  supposed  to  be  learning.  I  wish 
you'd  keep  an  eye  out  for  them  as  much  as  you  have  a 
chance  to,  and  see  that  they  keep  on  the  job.  Don't  let 
it  interfere  with  your  regular  work,  but  give  them  a  lift 
when  you  see  they  need  it.  They're  not  learning  what 
they  have  a  right  to  and  what  we  want  them  to,  if  we 
expect  them  to  be  of  value  to  us." 

A  guttural  monosyllable  was  the  only  answer  Johnson 
saw  fit  to  give.  It  might  have  indicated  anything  from 
distaste  for  the  task  to  disapproval  of  the  entire  appren- 
tice system.  The  foreman,  who  was  skeptical,  awaited 


124 DEVELOPING  YOUR   MEN 

the  result  in  some  doubt.  But  within  a  week  he  saw  a 
difference.  In  a  month  he  was  enthusiastic.  The  grouch 
had  disappeared ;  Johnson  was  not  merely  taking  a  lively 
interest  in  the  welfare  of  the  apprentices,  he  was  dis- 
playing keener  satisfaction  in  his  own  work.  The  latent 
sense  of  responsibility  had  been  called  into  play,  and  the 
factory  was  gaining  not  only  from  his  improved  work 
but  from  the  greater  attention  given  the  apprentices. 

The  incident  is  a  conspicuous  illustration  of  the 
modern  application  of  the  theory  that  "firing  comes 
last"  as  a  remedy.  The  superintendent's  interest  in  the 
affair,  it  is  true,  may  have  gone  farther  than  it  would 
but  for  the  fact  that  he  wanted  to  give  that  particular 
foreman  a  lesson  in  the  art  of  management.  Ten  years 
ago  Johnson  would  have  been  fired  without  question,  the 
apprentices  would  have  continued  to  learn  in  haphazard 
fashion,  and  the  foreman  would  have  missed  a  valuable 
pointer.  The  economic  advantage  of  the  new  method  is 
easy  to  recognize,  if  not  to  figure  in  dollars  and  cents. 

In  general,  it  may  be  said  that  the  new  type  of  dis- 
cipline is  based  on  the  "rule  of  reason"  to  a  greater 
extent  than  in  any  previous  system.  Once  military  dis- 
cipline, with  no  explanations  and  no  room  for  questions, 
was  favored.  If  the  individual  did  not  give  his  best 
work  under  this  system,  that  was  supposed  to  be  the 
individual's  loss.  The  loss  in  shop  efficiency  was  not 
considered.  There  are  workers  who  still  prefer  that 
form ;  they  have  no  desire  to  reason  why ;  theirs  but  to 
do  or — be  fired.  As  a  rule  they  are  the  ones  who  like  to 
avoid  responsibility.  Suggestions  for  improved  methods 
are  not  likely  to  come  from  them. 

The  best  worker  is  pretty  certain  to  be  the  one  who 
appreciates  a  knowledge  of  the  reasons  for  any  devia- 
tion from  routine  methods.  A  straight  appeal  to  reason 


FITTING   INSTEAD   OF  FIRING 


may  even  correct  a  fault  that  could  be  made  to  yield 
in  no  other  way.  But  it  must  be  a  reason  that  in  the 
mind  of  the  worker  is  not  trivial  and  one  that  comes 
within  the  range  of  his  own  point  of  view. 

An  employer  of  skilled  labor,  averaging  about  four 
dollars  a  day,  noticed  that  a  few  of  his  two  hundred 
men  were  in  the  habit  of  knocking  off  work  to  clean  up 
about  five  minutes  early  at  noon  and  night.  If  the  habit 
were  allowed  to  go  unchecked  it  would  have  been  only 
a  matter  of  time  when  all  the  two  hundred  would  be 
following  this  example.  He  might  have  corrected  the 
offenders  and  then,  if  they  persisted,  discharged  them. 
This  would  have  remedied  the  difficulty,  but  it  would 
have  left  a  feeling  of  discontent  at  what  the  men  would 
have  considered  petty  tyranny.  They  were  looking  at 
the  thing  from  the  point  of  view  of  ten  minutes  or  so 
out  of  a  nine  hour  day.  To  them  it  seemed  a  trifling 
matter.  No  remedy  that  failed  to  correct  that  impres- 
sion could  succeed. 

THIS  manager  got  right  down  to  brass  tacks  with  the 
men.     Waste   of  time   stopped   when  the  workers 
realized  the  money  loss  it  meant  to  their  employer. 

He  might  have  pointed  out  that  ten  minutes  of  lost 
time  for  a  four  dollar  man  was  approximately  seven  and 
a  third  cents.  This  would  merely  have  translated  time 
into  terms  of  money  and  left  the  flavor  of  pettiness.  It 
is  easy  to  imagine  that  "seven  and  a  third  cents"  becom- 
ing a  shop  joke  at  the  expense  of  the  employer,  the  effect 
of  which  would  have  revealed  itself  in  a  hundred  ways 
too  scattered  to  be  recognized. 

What  the  employer  actually  did  was  to  have  a  talk 
with  the  most  influential  of  the  offenders,  in  which  he 
pointed  out  what  they  all  knew,  that  the  industry  was 


126 DEVELOPING  YOUR   MEN 

in  a  position  to  expand,  but  that  it  needed  additional 
capital  with  which  to  do  so.  Then,  referring  to  the  ten 
minutes  a  day  which  some  of  them  were  consistently 
wasting,  he  said:  "Ten  minutes  a  day  wasted  by  each 
.of  you  two  hundred  men  would  decrease  the  borrowing 
capacity  of  this  industry  over  eighty-five  thousand  dol- 
lars." He  did  not  have  to  wait  for  a  question  in  order 
to  furnish  the  answer ;  their  uncomfortable  laughter  fur- 
nished that.  He  went  on  to  show  that  at  an  average 
wage  of  four  dollars  a  day  for  two  hundred  men,  ten 
minutes  a  day  meant  $14.80,  which  in  a  year  of  three 
hundred  days  amounted  to  $4,440,  and  that  $4,440  was 
five  per  cent  interest  on  more  than  $85,000. 

"You  see,  gentlemen,"  he  concluded,  "what  a  thing 
that  seems  insignificant  to  you  means  to  the  develop- 
ment of  this  business. ' '  They  saw,  and  the  petty  pilfer- 
ing of  time  stopped  abruptly,  while  instead  of  ridicule 
and  loss  of  respect  for  the  employer  the  men  had  an 
increased  respect  for  the  significance  and  importance  of 
their  own  jobs. 


A  MACHINE  is  a  unit  of  a  "plant  investment"  with  very 
restricted  limitations.  It  performs  today  what  it  did 
yesterday,  provided  it  is  well  taken  care  of,  protected  from  harm 
and  abuse,  oiled,  fed  with  power  and  given  periods  for  rest 
and  repair.  A  worker  is  a  human  being,  the  highest  expres- 
sion of  cosmic  creative  power,  a  person  of  peculiar  inherent 
abilities,  capable  of  great  development,  with  thoughts  and 
feelings  responsive  to  human  interest  and  justice. 

WILLIAM  ARMSTRONG  FAIRBUBN, 
President,  Diamond  Match  Company 


XII 

"GROWING"  YOUR  OWN 
EXECUTIVES 

By  Harry  Franklin  Porter, 
Organization  Engineer 

A  YOUNG  workman  en  route  home  from  work  one 
afternoon  was  engaged  in  conversation  by  a 
stranger  who  happened  to  be  passing  the  same  way. 
After  a  few  casual  interchanges,  the  subject  turned  to 
the  one's  occupation.  This  was  more  by  design  than  by 
accident,  on  the  part  of  the  stranger,  as  he  cherished 
a  fondness,  which  he  pursued  on  every  occasion,  for 
investigating  labor  conditions  from  the  men 's  side. 

"That's  a  pretty  fine  place  where  you  are  employed," 
said  he. 

"Yes,  I  guess  so,"  replied  the  workman,  without 
enthusiasm. 

"Out  here  in  the  country,  with  beautiful  surround- 
ings, the  buildings  modern  and  sanitary  conditions  excel- 
lent, I  shouldn't  wish  for  any  better  place  if  I  were 
a  shopman,"  continued  the  stranger. 

"Oh,  it's  all  right  as  far  as  that  goes,"  was  the 
rejoinder. 

"But  there  is  something  you  do  not  fancy  about  the 
place?"  interrogated  the  stranger  sympathetically.  "Is 
it  the  pay?" 

"Well,  no;  not  exactly.  They  pay  you  pretty  decent 
I  ain't  got  much  kick  comin'  on  that  score." 

"What  is  it,  then,  that  you  don't  like?" 


128 DEVELOPING   YOUR   MEN 

"Well,  it's  just  this:  a  feller  like  me  has  no  chance 
to  get  ahead.  When  there's  a  good  job  open,  they  never 
give  one  of  us  young  fellers  a  show;  they  always  hire 
in  some  new  guy.  I  wouldn't  mind  if  none  of  us  could 
do  the  work;  but  they  don't  seem  to  care  whether  we  can 
or  not.  I  'm  going  to  leave  as  soon  as  I  get  a  good  open- 
ing where  they  give  a  feller  half  a  chance  to  get  ahead. ' ' 
He  said  this  with  such  finality  that  the  other  did  not 
feel  disposed  to  press  the  conversation  further  along 
this  line.  So  after  a  few  pleasantries  the  two  parted. 

This  young  workman,  in  his  homely  way,  gave  vent  to 
a  sentiment  that  stirs  in  the  breast  of  every  normal, 
healthy  human  being.  It  is  a  main  propelling  motive  of 
masters  of  affairs ;  it  is  scarcely  less  a  dominating  force 
with  working  men  in  all  grades.  Good  pay  with  prospect 
of  increase  is  one  element;  agreeable  occupation  amidst 
pleasant,  healthful  surroundings  is  another;  but  these 
without  the  spur  of  promotion  are  inadequate  to  keep 
men  satisfied,  much  less  to  stimulate  them  to  put  forth 
their  best. 

To  develop  men's  efficiency  and  cement  their  loyalty, 
it  is  necessary  to  hold  before  them  steadily  a  higher  goal. 
They  will  even  work  for  less  pay,  and  tolerate  annoying 
and  discomforting  conditions,  if  only  they  may  be  as- 
sured of  a  future  in  some  degree  commensurate  with 
their  ambitions.  There  is  no  line  of  industry  today  which 
will  prove  an  exception  to  this  statement. 

Wise  managers  recognize  this  trait  of  human  nature 
and  study  constantly  to  keep  open  the  door  of  advance- 
ment in  their  establishments.  More  than  this,  they  seek 
assiduously  to  develop  the  talent  in  the  ranks.  In  other 
words,  they  not  only  strive  to  keep  open  the  door,  but 
they  lend  a  hand  in  helping  their  workers  forward  to 
it.  And  experience  shows  that  when  men  feel  a  push 


"GROWING"   YOUR  OWN   EXECUTIVES       129* 

from  below  as  well  as  a  pull  from  above  they  are  spurred 
to  the  most. 

Moreover,  purely  on  economic  grounds,  it  pays  to 
advance  the  men  you  have.  To  carry  out  a  policy  of 
systematic  development,  it  is  true,  involves  some  expen- 
diture ;  but  continually  to  be  introducing  new  men  from 
the  outside  is  much  more  expensive.  No  matter  how 
promising  a  new  man  may  be,  he  is  still ' '  raw  material, ' ' 
and  before  he  is  thoroughly  trained  into  his  new  posi- 
tion he  will  be  costing  you  more  money  than  he  is  mak- 
ing you.  One  manager  estimates  that  it  costs  him  two 
hundred  dollars  to  break  in  a  new  man  and  bring  him 
up  to  standard.  In  addition,  there  is  the  effect  on  the 
general  efficiency  of  the  department  to  consider  while 
the  newcomer  is  being  assimilated. 

HOW  assuring  workers  that  ability  and  merit  will 
be  recognized  and  rewarded  by  advancement  en- 
courages them  to  increased  endeavor. 

Besides,  the  expense  of  training  men  for  advancement 
is  not  nearly  so  great  as  might  be  supposed.  Once  let 
the  information  thoroughly  permeate  the  organization 
that  you  are  genuinely  interested  in  seeing  that  every 
man  has  the  opportunity  of  making  the  most  of  himself, 
that  ability  and  merit  will  be  recognized  as  promptly 
as  possible  and  be  rewarded  by  promotion,  and  auto- 
matically each  workman  in  the  establishment  who  has 
a  spark  of  ambition  in  him  will  begin  to  prepare  him- 
self for  something  better.  During  work  hours  he  will 
keep  his  eyes  and  ears  open  to  pick  up  every  scrap  of 
information  he  can.  Place  a  library  at  his  disposal  and 
you  will  find  him  taking  advantage  of  it  at  every  occa- 
sion. He  will  even  begin  to  pursue  studies  in  a  night 
school,  if  the  community  affords  this  advantage,  or  take 


130 DEVELOPING   YOUR   MEN 

up  a  correspondence  course.  Thus  the  amount  of  special 
training  you  will  have  to  provide  will  be  small  compara- 
tively, and  the  expense  involved  viewed  as  an  invest- 
ment— which  it  really  is — will  yield  particularly  rich 
returns. 

This  policy  is  wise  also  from  another  angle.  No  one 
knows  the  day  and  the  hour  that  the  most  important 
position  in  the  organization  may  become  vacant,  through 
the  exigencies  of  death  or  otherwise;  and  the  further 
down  the  line  you  go  the  greater  are  the  possibilities  of 
unexpected  gaps  occurring.  To  be  prepared  at  all  times, 
therefore,  to  meet  any  emergency  in  this  respect  from 
within  your  own  ranks  is  simple  business  foresight.  It 
is  comparable  to  carrying  fire  insurance  against  the 
ever-impending  blaze. 

So,  when  a  vacancy  occurs  the  first  place  to  look  for 
a  new  occupant  is  in  your  own  factory.  Give  your  own 
men  the  first  chance  in  every  case.  More  than  this,  be 
looking  ahead  constantly  to  help  qualify  likely  fellows 
for  possible  openings.  Then  you  may  be  sure  that  you 
are  doing  all  you  can  not  only  to  safeguard  your 
organization,  'but  to  instill  and  foster  in  it  that  most 
energizing  of  all  forces  in  man's  nature — hope. 

"The  one  thing  beyond  all  others  that  is  needed  for 
success,"  declared  one  of  the  foremost  industrial 
engineers  in  the  country  at  a  recent  meeting  of  the 
Efficiency  Society,  "whether  it  be  the  success  of  the 
worker  or  the  success  of  the  intellectual  man,  is  hope. 
This  is  the  most  important  element  to  foster,  cherish 
and  keep  in  the  minds  of  all  working  men.  In  order  to 
give  hope  you  must  first  of  all  have  in  your  mind,  in 
the  bottom  of  your  heart,  the  welfare  of  your  men.  The 
moment  a  manager  takes  this  for  his  ideal,  the  moment 
he  says,  'It  is  my  duty  in  life  to  develop  our  men,'  he 


"GROWING"   YOUR  OWN   EXECUTIVES      131 

will  see  that  it  is  the  part  of  management  to  do  an  enor- 
mously larger  amount  of  work  than  has  ever  been  done 
in  the  past  in  teaching,  in  training,  in  helping  men. 
Scientific  management  does  not  come  into  existence  until 
the  owners  of  a  business,  all  those  on  the  management 
side,  have  the  building  up  of  their  men,  the  develop- 
ment of  their  men,  as  absolutely  the  first  thought  in  their 
minds. ' ' 

Men  often  develop  faster  than  there  is  opportunity 
for  their  advancement.  When  they  do,  it  is  a  healthy 
sign;  but  therewith  comes  a  complication  of  the  man- 
ager's problem.  "Workers  who  are  too  good  for  their 
positions  are  the  most  difficult  of  all  to  keep  satisfied. 
They  are  like  a  stream  whose  waters  have  been  dammed 
up.  Some  will  overflow  into  criticism  and  complaint, 
which  affects  adversely  both  the  esprit  de  corps  and 
their  own  efficiency — if  they  but  knew  it.  Others  will 
sulk  themselves  into  stagnation,  the  effect  of  which  is 
almost  equally  demoralizing.  Still  others  will  pass  on 
and  out  at  the  first  opportunity,  ofttimes  to  their  better- 
ment, as  often  not.  Whether  to  their  loss  or  their  gain, 
it  is,  in  any  event,  to  the  management's  loss,  both 
directly  and  indirectly — through  the  creation  of  a  spirit 
of  unrest  and  dissatisfaction  in  the  ranks.  There  is  only 
one  way  to  combat  this  situation :  take  the  initiative 
yourself  in  finding  good  positions  elsewhere  for  those 
who  have  outgrown  your  establishment.  This  is  the 
policy  of  a  number  of  broad-minded  and  far-seeing  man- 
agers. These  figure  that  it  pays  occasionally  to  promote 
a  man  outside  for  the  sake  of  keeping  the  organization 
keyed  up  to  the  highest  pitch. 

On  the  other  hand,  nothing  could  be  more  disastrous 
to  a  factory  than  to  have  it  looked  upon  as  a  mere  train- 
ing school  for  other  places.  This  is  a  tendency  the 


182 DEVELOPING  YOUR  MEN 

manager  must  rigorously  oppose.  Various  counter- 
actives will  suggest  themselves.  Higher  pay,  better 
working  conditions,  a  more  advantageous  benefit  and 
pension  plan  than  elsewhere ;  the  ownership  of  homes  in 
the  vicinity;  profit-sharing;  opportunity  to  become 
stockholders — these  are  a  few  of  the  measures  that  have 
been  found  effective  in  holding  good  men.  To  make 
promotion  in  all  cases,  whether  outside  the  organization 
or  within,  contingent  upon  training  of  a  successor,  also 
is  beneficial.  It  acts  like  a  governor  upon  ambitious 
young  bloods.  In  their  impatience,  these  frequently  err 
in  thinking  that  they  are  ready  for  advancement  when 
they  are  not.  The  test  is  their  willingness  and  ability 
to  teach  someone  else  their  job.  Surely  no  one  is  quali- 
fied better  or  more  economically  to  instruct  another  than 
he  who  has  become  so  expert  in  a  task  that  he  is  ready 
to  take  a  step  higher.  Rarely  does  such  a  test  fail  to 
detect  any  weakness.  And  the  mere  doing  of  it  increases 
his  value.  Thus  the  benefit  is  twofold. 

HOW  the  'promotion  of  employees  can  be  handled  so  as 
to  attain  the  best  results.    Why  promoting  men  from 
the  ranks  acts  as  a  general  incentive. 

A  large  organization,  where  operations  are  highly 
departmentalized  and  specialized,  seldom  has  to  resort 
to  the  expedient  of  outside  promotion.  For  within  the 
works,  as  a  rule,  there  is  abundant  opportunity  to  use 
all  the  ability  that  may  be  developed  and  the  advance- 
ment possible  is  such  as  to  satisfy  the  desires  of  the  most 
ambitious.  On  this  account  the  larger  plants,  if  also 
they  are  highly  efficient,  tend  to  attract  the  cream  of  the 
talent,  just  as  our  thriving  metropolitan  cities  are  lode- 
stones  for  the  best  blood  of  the  rural  districts  and  small 
towns.  Consequently  the  smaller  a  plant  the  greater  is 


"GROWING"   YOUR  OWN   EXECUTIVES      133 

the  need  for  an  adequate  scheme  of  promotion  which  will 
include  graduation  to  higher  positions  elsewhere. 

Merit,  of  course,  must  be  the  first  basis  of  advance- 
ment. Length  of  service  needs  also  to  be  weighed,  but 
only  when  other  things  are  equal  may  it  safely  be  given 
first  consideration.  Nothing  could  be  more  dampening 
than  to  make  seniority  the  chief  test.  On  the  other 
hand,  the  effect  is  almost  equally  dispiriting  of  failure 
properly  to  weigh  this  element.  Faithful  service  always 
is  deserving  of  its  due  reward.  Relationship  to  one  in 
authority  or  any  personal  claim  to  favor,  needless  to 
say,  can  have  no  place  if  the  scheme  of  promotion  is  to 
succeed.  The  only  safe  way  is  to  judge  men  strictly  and 
impartially  on  their  records. 

Merit  also  must  be  the  chief  criterion  in  bringing  in 
an  outsider.  However  excellent  is  the  policy  of  filling 
vacancies  from  the  ranks,  inflexible  adherence  to  it  is 
sure  to  result  in  a  gradual  letting  down  all  along  the 
line.  Give  your  own  men  the  first  chance  but  do  not 
hesitate  to  introduce  new  blood  if  the  issue  has  nar- 
rowed to  one  of  fitness  purely.  When  your  men  know 
that  vacancies  will  be  filled  this  way,  in  case  none  of 
them  is  sufficiently  developed  to  qualify,  they  will  be 
stimulated  to  increased  endeavor.  Moreover,  occasion- 
ally it  pays  to  bring  in  a  new  man  for  the  sake  of  the 
invigorating  reaction  of  a  fresh  viewpoint  upon  the 
atmosphere  of  the  shop.  But  guard  carefully  lest  this 
departure  from  the  established  rule  be  construed  as  an 
undue  discrimination  against  old  hands. 

Rarely  is  it  necessary  to  have  recourse  to  an  outside 
supply,  except  of  course  for  beginners  and  common  or 
unskilled  labor,  and  as  a  rule  all  newcomers,  regardless 
of  their  previous  experience,  should  start  in  at  the  lowest 
level.  From  these  should  come  the  semi-skilled  work- 


134 DEVELOPING   YOUR    MEN 

men,  and  from  this  class  the  skilled  machine  operators 
and  tool  makers.  Normally  in  turn  the  skilled  class 
should  furnish  the  foremen  and  other  responsible  heads. 
But  because  a  man  is  an  excellent  workman,  it  does 
not  follow  always  that  he  will  make  a  satisfactory  shop 
executive.  As  a  matter  of  fact,  it  is  the  experience  of 
managers  that  the  best  mechanics  often  make  the  poorest 
foremen.  "We  promote  a  man  from  the  ranks  when- 
ever we  can,"  said  one  manufacturer,  "for  we  prefer 
a  foreman  who  has  intimate,  practical  knowledge  of  the 
work  he  is  to  supervise.  Unfortunately,  however,  few 
workmen  possess  the  qualities  essential  to  success  as  a 
foreman. 

Leadership  ability  we  deem  more  important  than 
ability  actually  to  do  the  work,  for  a  bright  fellow  who 
knows  how  to  handle  men  will  soon  enough  learn  the 
other  part  of  it.  Therefore,  we  do  not  hesitate  to  go 
outside  to  get  the  man  we  want."  Often,  too,  a  work- 
man elevated  from  the  ranks  who  has  the  making  of  a 
good  foreman  will  fail  to  fulfill  expectations  because  of 
his  inability  to  work  himself  free  from  his  former  asso- 
ciations. "Familiarity  breeds  contempt."  If  he  has 
the  right  stuff  in  him,  however,  and  receives  the  proper 
backing  from  above,  he  will  in  time  overcome  this  handi- 
cap. It  is  wise,  at  any  rate,  to  give  one  of  your  own 
men  a  fair  trial,  for  the  sake  of  the  encouragement 
thereby  afforded  the  remainder  of  the  good  men  in  the 
department.  Besides,  you  have  accurate  knowledge  of 
one  who  has  won  his  spurs  as  a  workman,  whereas  a 
newcomer,  no  matter  how  promising,  always  is  more  or 
less  of  an  uncertain  quantity. 

One  manager  found  effective  the  expedient  of  getting 
his  foremen  from  other  departments.  For  instance,  he 
took  a  high-grade  foundryman  and  made  him  foreman 


"GROWING"   YOUR  OWN   EXECUTIVES      135 

of  the  drippers  and  grinders.  For  his  chief  product 
inspector  he  took  a  foundry  clerk ;  for  superintendent  of 
factory  transportation,  he  took  a  checker  in  the  ship- 
ping room.  Occasionally  he  drafted  a  foreman  from  one 
department  for  service  in  another.  In  this  way  he 
avoided  both  the  incubus  of  familiarity  that  attaches  to 
a  workman  elevated  to  the  foremanship  in  his  own 
department  and  the  dispiriting  effect  that  attends  the 
bringing-in  of  a  total  outsider.  As  he  exercised  rare 
discretion  in  picking  his  men  for  their  leadership  quali- 
ties and  keenness  of  observation,  he  almost  never  scored 
a  failure.  An  unexpected  gain  incidentally  resulted. 
Men  shifted  from  an  initial  to  a  final  department  showed 
greater  patience  with  the  shortcomings  of  preceding 
departments  and  were  more  constructive  in  their  criti- 
cisms thereof,  while  those  transferred  in  the  reverse 
direction  evinced  an  uncommonly  deep  interest  in  all 
the  details  of  the  work  that  affected  the  production  of 
succeeding  departments.  A  higher  standard  of  work- 
manship thus  was  promoted  throughout  the  plant. 

SOMETIMES  good  results  can  be  obtained  by  depart- 
ing from  the  beaten  track,  and  promoting  men  of 
specialized  knowledge  into  positions  in  other  departments. 

This  same  expedient  often  is  equally  successful  with 
respect  to  the  positions  of  broader  executive  responsi- 
bility. An  Iowa  manufacturer  of  agricultural  ma- 
chinery, for  instance,  when  his  establishment  had  grown 
so  large  that  he  felt  the  need  of  an  assistant  to  him- 
self, called  to  the  post  the  sales  manager  of  one  of  his 
branch  offices.  He  did  this  in  lieu  of  promoting  his 
superintendent  because  he  wished  to  have  more  of  the 
sales  viewpoint  impressed  upon  the  shop.  The  new 
manager  was  handicapped,  of  course,  by  his  lack  of 


136 DEVELOPING  YOUR   MEN 

practical  experience  in  manufacturing,  but  he  knew 
what  constituted  a  salable  product.  Besides,  he  was 
possessed  of  a  keen  observation  and  no  little  executive 
ability,  and  in  the  course  of  a  year  or  two,  under  the 
careful  tutelage  of  the  president,  he  demonstrated  his 
worth  completely. 

Quite  the  reverse  were  the  reasons  of  a  Pennsylvania 
metal  furniture  manufacturer  for  choosing  for  his  new 
general  manager,  to  have  direction  of  both  production 
and  sales,  his  shop  superintendent.  He  had  been 
troubled  for  years  with  a  flood  of  special  orders  and  he 
wished  to  have  one  in  control  of  the  two  ends  of  the 
business  who  had  a  vivid  appreciation  of  the  effect  on 
manufacturing  costs  of  promiscuous  departures  from 
standard.  The  new  executive  speedily  proved  his  value 
by  training  the  sales  force  to  push  regular  lines  almost 
exclusively. 

Logically,  foremen  should  be  in  line  of  promotion  for 
the  higher  positions.  More  infrequently,  though,  are 
these  qualified  for  larger  responsibility  than  workmen 
are  fitted  for  foremanships.  For  one  reason  they  usually 
lack  the  broad  outlook  requisite.  Again,  for  men  who 
shall  have  general  direction  of  work,  some  technical 
qualifications  are  preferable  if  not  essential.  It  is  a 
rare  foreman  who  is  fortified  for  advancement  in  this 
respect.  Accordingly,  for  the  higher  positions  the 
source  of  supply  must  of  necessity  be  largely  outside. 

But  the  demand  for  men  of  this  type  is  always  in 
excess  of  the  supply.  Full-fledged  superintendents  and 
factory  managers  are  not  often  found  foot-loose  and 
free,  waiting  to  be  snapped  up  by  the  first  comer.  It  is 
necessary  as  a  rule  to  bid  for  the  service  of  such,  and 
sometimes  to  bid  high.  Even  then  it  may  be  impossible 
to  get  the  man  you  need  when  you  need  him. 


"GROWING"  YOUR  OWN  EXECUTIVES      187 

In  anticipation  of  the  usual  difficulty  a  Wisconsin 
maker  of  sanitary  ware,  foreseeing  the  necessity  of 
replacing  his  superintendent  by  a  younger  and  more 
energetic  man  with  a  broader  and  more  scientific  view- 
point, hired  a  young  engineer  graduate  who  had  a  year 
or  two  of  practical  experience  along  efficiency  lines.  He 
kept  him  at  this  same  sort  of  work  for  several  years, 
moving  him  from  operation  to  operation  until  the  entire 
round  had  been  covered.  Then,  one  day,  as  if  by  no 
intention,  the  young  engineer  was  put  in  charge  of  a 
department.  He  is  succeeding  splendidly  and  it  is  only 
a  question  of  time  before,  again  as  if  without  design, 
he  will  be  advanced  to  the  superintendency.  Some  day 
he  will  be  called  still  higher. 

Similarly  it  is  the  practice  of  a  number  of  leading 
manufacturing  concerns  to  take  on  every  year  one  or 
more  promising  technical  school  graduates  with  a  view 
to  the  future.  These  are  started  at  the  bottom,  pushed 
forward  as  rapidly  as  possible  from  one  class  of  work  to 
another  until  finally,  if  they  demonstrate  the  proper 
aptitude  for  shop  life,  they  are  elevated  to  positions  of 
executive  responsibility.  By  this  means  the  occasion 
for  departing  from  the  established  policy  of  filling  all 
vacancies  from  the  ranks,  even  in  the  case  of  the 
highest  positions,  is  reduced  to  a  minimum. 


IF  IN  the  days  to  come,  as  you  have  to  do  with  labor,  you 
will  put  yourself  in  the  other  man's  place  and  govern 
your  action  by  what  you  would  wish  done  to  you  were  you  the 
employee  instead  of  the  employer  the  problem  of  the  estab- 
lishment of  the  personal  relation  in  industry  would  be  solved." 

JOHN   D.    ROCKERFELLEB   JB. 

.4  piece  of  labor  handling  advice  gite* 

students  of  Cornell  U  niter  tit* 


XIII 
THE  BUILDING  OF  MEN 

An  Interview  with  Edward  B.  Butler, 

Chairman  of  the  Board  of  Directors  of  Butler  Brothers 

By  Carroll  D.  Murphy 

EVERY  business  concern,  whether  large  or  smallr 
is  eagerly  looking  for  men  of  promise.  And  it  is 
the  experience  of  nearly  all  that  they  can  find  such  men, 
but  the  difficulty  lies  in  their  inability  to  hold  them.  It 
is  no  longer  considered  a  misfortune,  as  it  was  thirty 
years  ago,  for  a  young  man  to  change  about  from  posi- 
tion to  position.  Again,  there  are  too  few  who  are 
willing  to  work  hard,  even  though  they  must  know  that 
a  large  measure  of  success  awaits  the  result  of  their 
labor. 

To  get  men  to  work  with  anything  like  the  same  interest 
you  have  in  your  own  business,  you  must  show  them  that 
you  are  relying  upon  them.  We  all  have  our  responsi- 
bilities. Too  many  young  fellows  feel  that  they  have 
none.  In  any  great  business,  the  employee  is  responsible 
for  the  good  opinion  of  that  house.  Quoting  Mr.  Butler 
"we  like  to  remind  our  people  that  when  a  voice  goes 
to  a  customer  over  the  telephone,  it  is  Butler  Brothers 
who  is  speaking.  When  an  usher  meets  a  customer  at  the 
front  door,  it  is  Butler  Brothers  shaking  hands  with  that 
merchant.  And,  by  the  way,  you  can,  in  a  measure 
at  least,  judge  the  house  by  the  tone  of  voice  which  comes 
to  you  over  its  telephone,  just  as  you  can  at  times  judge 
the  head  of  a  house  by  the  attitude  of  the  usher  whom 
you  meet  at  the  entrance. ' ' 


THE   BUILDING   OF   MEN 139 

Responsibility  extends  beyond  the  routine  work.  He 
who  does  his  work  by  rule  may  think  he  does  his  duty, 
but  the  man  who  reaches  the  higher  place  is  the  one  who 
does  his  duty  and  a  little  more.  One  man,  in  passing 
through  the  hallway,  discovers  that  a  window  has  been 
left  open  and  that  the  rain  has  been  beating  in.  It  may 
not  be  that  man's  business  to  close  windows.  That 
belongs  to  the  operating  department.  But  passing  by, 
he  gives  the  matter  a  thought  and  closes  the  window. 
Another  man  would  not  have  done  it.  It  is  the  one  who 
closed  the  window  who  is  the  most  valuable  man.  He 
thinks1. 
i 

MANAGERS  of  men  should  remember  that  they  are 
directing  men  and  not  machines — the  occasional 
friendly  word  often  gives  a  spur  to  more  effective  voork. 

It  is  difficult  to  get  some  men  to  let  go  of  details;  to» 
grow  up  into  control;  to  think  for  the  men  who  do  not 
think.  In  every  business  there  is  some  one  man  who 
can  do  the  work  of  three.  The  trouble  is  that,  as  an 
individual,  he  cannot  do  more.  To  capitalize  that  man's 
ability,  he  should  be  put  in  charge  of  three  dozen  men, 
and  he  should  be  taught  to  direct  the  energy  of  all. 

Any  man  who  is  at  the  head  of  a  business  that  has 
grown  to  large  proportions1  naturally  has  a  keen  interest 
in  the  future  of  that  business — in  its  continuation  after 
he  has  gone.  His  greatest  concern  will  naturally  be  in 
the  building  of  the  men  who  are  to  become  its  future 
leaders.  But  one  man's  efforts  alone  will  not  go  far  to 
develop  the  necessary  individual  interest  and  initiative. 
The  department  heads  all  along  the  line  must  keep  up 
this  work.  The  head  of  every  sub-department  also  must 
become  acquainted  with  his  people. 


140 DEVELOPING   YOUR   MEN 

Not  only  must  he  know  them  in  their  hours  of  work, 
but  he  must  know  something  of  their  home  life  as  well. 
The  head  of  a  department  should  so  organize  his  force 
that  his  people  become  almost  as  a  family  group.  The 
boy  iu  this  department  ofttimes  needs  brotherly  advice 
which  his  chief  can  give  him  better  than  anyone  else. 
It  is  in  such  a  department  that  the  "Good  night"  to 
one  another  is  heard  as  they  leave  for  their  homes.  It 
is  in  just  such  ways  as  this  that  the  department  head 
can  supply  that  spirit  of  good-fellowship  which  is  so 
generally  lacking  in  the  big  house. 

You  will  hear  a  good  deal,  in  almost  any  business, 
about  letting  the  new  man  or  new  boy  ' '  work  out  his  own 
salvation,"  but  that  does  not  mean  that  he  is  not  to  be 
taught.  He  must  be  helped.  If  not,  the  average  man 
will  soon  lose  any  enthusiasm  that  he  may  have  had. 
A  word  of  encouragement  and  suggestion  from  his  chief 
will  often  set  him  on  the  right  track.  If  he  is  making 
good,  tell  him  so. 

In  a  big  modern  business,  the  head  of  a  department 
is  so  busy  that  he  often  forgets  the  value  of  the  depart- 
mental family  spirit,  and  being  out  of  personal  touch 
with  his  people,  he  is  unintentionally  unfair  at  times. 
One  of  his  men  comes  in  late ;  but,  being  a  stoic,  he  offers 
no  excuse.  He  goes  about  his  work  carrying  his  burden 
alone.  It  may  be  that  at  home  he  has  a  sick  mother 
with  whom  he  has  been  up  all  night.  In  the  little  busi- 
ness, this  fact  would  have  been  known  by  his  superior, 
and  the  question  in  the  morning  would  have  been :  "How 
is  the  mother?" 

That  thoughtful  question  would  have  made  a  big 
difference  to  the  worker.  The  right  kind  of  comrade- 
ship in  a  department  is,  as  you  will  see,  all-important  in 
the  development  of  good  people  for  a  business. 


THE  BUILDING   OF   MEN 141 

"Without  the  right  men,  you  cannot  have  the  right 
spirit.  Without  the  right  spirit,  you  cannot  have  the 
right  men.  Spirit  is  the  most  valuable  asset  that  a  house 
can  possess.  Spirit  is  something  you  cannot  make.  It 
is  something  you  cannot  buy.  It  has  to  grow.  It  grows 
out  of  a  belief  in  the  heads  of  a  business.  It  is  a  plant 
so  delicate  that  it  cannot  survive  in  an  atmosphere  of 
favoritism,  or  where  push  or  pull  has  any  place. 

One  of  the  vice-presidents  of  Butler  Brothers  likes  to 
tell  about  his  first  day  with  the  house.  He  started  in  as  a 
lad  of  sixteen,  and  on  the  first  day  was  set  at  work  sewing' 
buttons  on  sample  cards.  The  day  was  hot  and  sultry. 
The  work  of  pushing  the  needle  through  the  stiff  cards 
had  hurt  his  fingers.  He  was  to  receive  three  dollars. 
a  week,  and  he  says  that  by  noon  he  had  planned  exactly 
what  he  was  going  to  do  about  the  half-dollar  he  was 
to  earn  for  the  first  day's  work.  He  wasn't  coming  back 
for  it,  as  he  had  decided.  He  was  through  with  that 
job. 

But  he  tells  that  during  the  afternoon  one  of  the 
members  of  the  firm  came  to  him  and  said,  "You  are 
sewing  those  buttons  on  very  nicely,  but  you  are  not 
doing  it  in  the  best  way,  and  you  are  hurting  your  fingers. 
Let  me  show  you  how  to  do  it."  The  result  was  that 
instead  of  quitting  his  job,  he  went  home,  and,  flushed 
with  pleasure,  told  his  mother  how  a  member  of  the 
firm  had  complimented  him  and  then  had  shown  him  a 
better  way  to  do  his  work.  His  enthusiasm  responded 
to  this  first  sign  of  encouragement  and  he  has  since  been 
one  of  the  strongest  forces  in  the  development  of  a  great 
business.  How  costly  to  that  business  would  have  been 
the  loss  of  that  man ! 

This  illustration  goes  to  show  the  importance  of  giving 
every  one  a  fair  chance.  The  wise  department  man  will 


142 DEVELOPING   YOUR    MEN 

listen  to  suggestions  from  the  smallest  boy  in  his  group. 
In  this  manner  some  heretofore  unknown  young  man  may 
reveal  himself. 

It  is  a  great  thing  to  discover  a  man.  Think  what  it 
would  mean  to  discover  in  the  form  of  an  untried 
youth  one  who  was  destined  to  become  a  great  business 
genius.  Or,  better  still,  to  help  a  man  to  discover  him- 
self— to  find  himself.  Some  men  find  themselves  easier 
and  earlier  than  others.  Many  men  have  a  seed  of 
ability,  to  develop  which  needs  only  the  kindly  encourage- 
ment of  their  superiors. 

If  you  know  of  any  men  who  have  fallen  into  the  habit 
of  thinking  that  others  have  appropriated  all  of  the 
opportunities,  that  none  are  left  to  them,  just  tell  them 
to  think  their  way  out  of  that  belief.  And  if  they  will 
do  that,  they  will  have  made  a  good  start  toward  that 
future  thinking  which  so  certainly  means  success. 


THE  average  young  man  is  going  to  develop  in  business 
according  to  the  training  he  receives.     In  taking  young 
men  into  our  organization,  we  therefore  assume  somewhat 
of  a  moral  responsibility.     They  consign  themselves  to  us 
as  so  much  raw  material.     It  is  not  only  up  to  us  to  help 
them  make  good,  but  to  stand  behind  them  and  back  them  up 
while  they  are  in  the  process  of  "maJdng  good". 
C.  II.  SLOCUM, 

President  of  the  St.  Pnul  Book  and  Stationery  Co. 


XIV 
SHAPING  MEN  TO  THE  WORK 

By  C.  H.  Slocum, 
President  of  the  St.  Paul  Book  and  Stationery  Company 

TRAINING  employees,  shaping  men  to  the  work  and 
methods  of  a  business — developing  in  them  initia- 
tive, responsibility,  enthusiasm,  cooperation,  integrity, 
and  loyalty — is  preeminently  a  human  problem.  At 
least,  so  I  have  found  it. 

Years  of  experience  in  hiring  and  firing  have  disclosed 
to  me  no  standardized  system  of  methods  by  which  I 
might  measure  in  advance  the  capabilities  of  a  worker. 
By  experiment  and  test,  by  watchfulness  and  develop- 
ment, we  find  out  men.  In  employing  new  people  we 
try  to  select  those  who  can  be  built  into  our  business. 
The  kind  of  men  we  are  looking  for  today  is  the  kind 
we  will  need  in  our  business  tomorrow. 

Practically  every  department  manager  with  us  today 
started  in  as  an  office  boy  or  in  some  minor  position,. 
The  secretary  and  treasurer  of  our  firm  began  as  sales- 
men on  the  retail  floor.  These  men  have  come  up  through 
the  ranks  with  the  development  of  our  business.  They 
are  always  on  the  keen  lookout  for  ways  of  bettering 
their  departments  and  the  business  as  a  whole. 

The  best  little  promoter  of  enthusiasm,  integrity,  and 
loyalty  among  employees  that  I  know  of  is  the  Almighty 
Dollar — given  where  it  is  earned.  A  few  months  ago  a 
young  man  came  to  us  and  applied  for  a  position.  We 
liked  his  appearance  and  gave  him  a  place  in  our  ship- 


144 DEVELOPING   YOUR   MEN 

ping  department.  His  job  was  to  wrap  up  packages. 
"We  started  him  in  at  $45  a  month.  In  less  than  six 
weeks  the  department  manager  came  to  me  and  said 
that  this  young  man  was  worth  more  money ;  that  he  was 
economical,  conscientious,  and  a  swift,  careful  workman 
and  had  made  an  excellent  record. 

We  raised  this  young  man's  salary  and  dated  it  back 
two  weeks.  This  gave  him  such  an  incentive  for  better 
work  that  he  soon  worked  himself  out  of  the  shipping 
department.  We  changed  him  to  another  position  and 
gave  him  more  responsibility.  We  will  keep  on  changing 
him  until  he  has  gained  a  thorough  knowledge  of  our 
business.  In  a  few  months  he  will  have  a  better  position 
and  his  salary  will  keep  pace  with  his  advancement. 

Each  department  manager  has  strict  orders  that  as 
soon  as  an  employee  in  a  department  is  actually  worth 
more  money  to  the  firm  that  their  salary  shall  be  raised 
immediately.  We  do  not  wait  for  the  first  of  the  month. 
Forty  to  fifty  employees  received  a  raise  recently  and 
not  one  of  them  asked  for  more  money.  We  are  not 
running  a  philanthropic  institution,  but  if  we  expect 
fairness  from  our  employees,  we  first  must  be  fair  in 
our  dealings  with  them. 

In  our  organization  we  have  many  young  men.  We 
prefer  them.  We  pick  up  bright  young  fellows  and 
train  them  in  our  way  of  doing  things.  The  average 
young  man  is  going  to  develop  in  business  according  to 
the  training  he  receives.  In  taking  young  men  into  our 
organization,  we  therefore  assume  somewhat  of  a  moral 
responsibility.  They  consign  themselves  to  us  as  so 
much  raw  material.  It  is  not  only  up  to  us  to  help 
them  make  good,  but  to  stand  behind  them  and  back 
them  up  while  they  are  in  the  process  of  "making 


TRAINING    WORKERS 145 

good."     If  they  eventually  grow  beyond  us,  that  is  our 
fault,  but  we  try  not  to  let  good  men  go. 

Our  business  is  well  divided  by  departments  and  our 
employees  are  trained  by  departments.  While  every 
employee  is  hired  to  do  a  certain  class  of  work  in  a 
specific  department,  we  frequently  change  them  from 
one  department  to  another  so  that  they  gradually  come 
to  have  a  working  knowledge  of  the  business  as  a  whole. 
Whenever  we  are  short  handed  in  one  department  we 
know  that  we  can  draft  men  from  other  departments  to 
fill  up  the  gap.  While  these  men  may  not  work  as 
rapidly  as  those  who  are  employed  regularly  in  the 
department,  they  produce  efficient  results  and  enable 
us  to  get  today 's  work  done  today  and  at  the  same  time 
keep  our  whole  organization  up  to  a  high  working  stand- 
ard. This  applies  particularly  to  our  operating  depart- 
ments. 

HOW  employees  are  so  initiated  into  the  business  that 
few  mistakes  are  made  and  they  are  less  likely  to 
become  discouraged  at  the  start. 

A  large  portion  of  our  business  is  handled  through 
our  mail-order  department.  We  are  doing  business  in 
every  state  and  in  many  foreign  countries.  This  busi- 
ness is  handled  by  direct  mail  methods.  Here  we  must 
take  precautionary  measures  against  possible  mistakes. 
Regardless  of  the  fact  that  every  order  is  checked  by  a 
number  of  individuals  before  it  is  forwarded,  we  believe 
we  are  avoiding  many  needless  mistakes  by  first  giving 
each  employee  a  thorough  working  knowledge  of  our 
business  before  starting  them  in  at  the  work  they  have 
been  employed  to  do.  We  accomplish  this  by  starting- 
new  employees  in  on  a  class  of  work  we  term  "Show 
Me's."  This  may  be  anything  in  the  nature  of  a  com- 


146 DEVELOPING    YOUR    MEN 

plaint.  First,  the  employee  is  given  the  correspondence 
which  states  the  complaint.  We  will  say  that  a  shortage 
has  occurred  in  a  shipment  of  books.  As  each  customer's 
order  comes  in  it  is  put  on  a  card  and  filed  alphabeti- 
cally. This  card  contains  all  the  information  regarding 
the  order.  The  first  step  is  to  get  this  card  and  the 
-order  number.  Next,  a  duplicate  copy  of  the  order 
sheet  will  be  found  on  file  in  the  departments  which 
filled  the  order.  This  information  is  gathered  and  taken 
to  the  shipping  department  where  it  is  compared  with 
the  duplicate  shipping  ticket.  If  these  duplicates  cor- 
respond, then  we  know  that  the  mistake  has  occurred  at 
the  other  end  of  the  line  or  in  transit.  This  information 
is  attached  to  the  correspondence  and  returned  to  my 
desk. 

The  point  is  that  the  young  man  who  made  this 
investigation  has  come  in  actual  contact  with  a  number 
of  departments  and  managers.  Everyone  with  whom 
he  has  come  in  contact  has  helped  him  gather  all  avail- 
able information  regarding  this  complaint.  In  a  short 
time  this  work  will  have  shown  him  the  working  prin- 
ciples of  every  department  in  our  business.  When  some- 
thing comes  up  while  this  man  is  working  at  his  own 
job — something  which  requires  a  knowledge  of  the  work 
in  other  departments — this  man  will  know  or  will  be 
able  to  act  quickly. 

This  experience  helps  a  new  man  to  quickly  lose  any 
feeling  of  strangeness  which  he  probably  had  when  he 
started  in.  Unconsciously,  he  has  been  learning  our 
business  methods,  If  we  had  tried  to  explain  these 
same  methods  by  word  we  might  have  had  a  sorry  job  of 
it.  And  if  the  applicant  did  not  grasp  at  once  what  we 
were  driving  at,  he  probably  would  become  discouraged 
before  he  began.  Instead  of  this  happening,  he  actually 


TRAINING    WORKERS 147 

out  every  method  connected  with  his  work.  This 
makes  it  easier  for  the  employee,  gives  him  confidence 
and  faith,  and  once  having  this  experience  he  is  less 
liable  to  make  mistakes. 

However,  mistakes  happen.  We  all  make  them.  Not 
long  ago  we  received  an  order  for  thirty  calendars  from 
a  school  teacher  in  a  country  district.  This  order  arrived 
during  the  Christmas  rush.  We  were  out  of  the  particu- 
lar calendar  ordered.  A  young  man  in  the  department 
which  would  ordinarily  fill  this  order  knew  that  by 
ordering  direct  from  the  factory  these  calendars  would 
reach  the  customer  on  time.  In  making  out  the  order 
he  put  down  330  calendars  instead  of  30.  The  factory 
made  the  shipment.  And  the  school  teacher  promptly 
informed  us  that  she  had  not  intended  to  embark  in 
the  calendar  business.  We  wrote  this  customer  to  take 
whatever  number  she  could  use  and  forward  the  balance 
to  us  at  our  expense.  The  man  who  made  the  mistake 
simply  wilted.  Of  course  it  was  a  bad  blunder.  How- 
ever, this  mistake  was  not  charged  up  to  the  employee. 
We  bought  new  calendar  date  pads  and  sold  these  goods 
for  use  the  following  season. 

When  a  mistake  occurs,  regardless  of  who  made  it,  we 
do  not  raise  a  merry  row.  Instead,  we  go  to  the  em- 
ployee at  fault  and  say  something  like  this,  "Now  this 
mistake  has  been  made.  We  know  that  it  did  not  happen 
intentionally.  It  is  all  right  and  will  not  be  charged 
against  you.  Next  time  do  it  so  and  so."  And  the 
incident  is  closed.  When  employees  make  mistakes  the 
natural  inclination  is  for  them  to  get  flustered.  Some- 
times they  lose  courage  and  confidence  in  themselves. 
We  try  to  prevent  this.  If  an  employee  is  afraid  to  go 
ahead,  loses  initiative,  keeps  running  to  the  department 
head  or  other  workers  for  this  and  that  and  the  other 


148 DEVELOPING  YOUR   MEN 

thing,  then  they  not  only  waste  time  with  their  own  work, 
but  waste  the  time  of  others  and  upset  the  mental  equi- 
poise of  their  department.  The  losses  we  make  good  on 
employees'  mistakes  are  more  than  paid  back  to  us 
through  the  saving  of  time,  the  development  of  intiative, 
and  the  value  of  confidence  our  workers  have  in  them- 
selves. Of  course,  if  an  employee  persists  in  making- 
mistakes  continually  he  must  go. 

FROM  the  time  he  starts  the  eyes  of  the  management 
are  upon  the  worker — questions  affecting  him  are 
not  considered  haphazardly,  but  from  the  personal  angle. 

A  closer  study  of  the  lines  of  our  work  which  interests 
an  ambitious  employee  helps  us  in  selecting  our  men. 
We  try  to  find  the  work  which  the  employee  likes  to  do 
best.  We  can  do  this  only  by  watchfulness,  experiment, 
and  test.  Five  years  ago  a  young  chap  came  to  us  and 
applied  for  a  position  which  was  open  in  our  library 
department.  He  happened  to  slide  into  a  position  which 
held  his  interest  from  the  beginning.  Today  he  is  in 
charge  of  the  department,  handles  all  the  correspondence 
connected  with  it,  and  is  responsible  for  its  management. 
More  often  than  not,  the  reverse  situation  occurs.  Then 
we  must  find  a  job  for  the  man.  Sometimes  this  is  not 
possible.  If  people  are  entirely  unsuited  for  the  work 
they  are  doing  we  advise  them  to  make  a  change  and 
try  another  line.  Occasionally  employees  slow  up  in 
their  work.  Perhaps  we  all  do.  Most  of  us  get  back 
to  normal  in  a  day  or  so  and  simply  say  that  yesterday 
was  an  off  day.  Once  in  awhile  we  find  an  employee 
who  slows  up  and  doesn't  "come  back."  Such  a  case 
happened  not  long  ago.  This  young  man  did  his  work 
but  lacked  ' '  pep ' '  and  enthusiasm.  He  was  not  looking1 
ahead  for  the  other  fellow's  job.  I  discovered  tha* 


TRAINING   WORKERS 149 

when  a  rush  of  work  came  through  his  department  he 
kept  up  his  own,  yet  he  never  got  ahead  of  it  or  offered 
to  help  the  other  boys.  I  decided  that  "watchful  wait- 
ing" would  bring  results  in  this  case. 

Several  employees  in  this  department  who  were  doing 
well  received  an  increase  in  their  salary.  The  young 
man  in  question  did  not.  Shortly  after  he  came  into  my 
office.  He  told  me  that  it  had  been  some  time  since  he 
had  had  a  raise  and  reminded  me  of  the  fact  that  another 
employee  in  the  same  department  had  received  two  in 
six  months.  I  did  not  find  fault.  I  simply  explained 
that  while  he  was  earning  what  we  were  paying  him  he 
was  not  progressing  and  certainly  was  not  worth  any 
more  money  at  the  present  time.  He  saw  the  point. 
Not  long  after  this  the  manager  of  this  department  told 
me  that  this  young  chap  was  worth  more  money.  He 
got  his  raise  on  the  dot.  Now  he  is  doing  fine. 

Off  and  on,  we  check  the  general  efficiency  of  our 
employees.  This  is  done  by  departments.  In  our  book 
stock  rooms  we  have  our  book  pickers  make  a  daily 
report  giving  the  number  of  each  order  filled  and  the 
number  of  books  on  each  order.  If  a  man  is  only 
picking  five  hundred  books  on  thirty  orders,  and  we 
know  that  he  should  be  able  to  pick  a  thousand  books  in 
the  same  amount  of  time,  we  bring  this  fact  before  his 
attention.  The  check  itself  keeps  the  men  up  to  maxi- 
mum. They  know  what  is  expected  and  that  they  must 
deliver  full  measure.  Other  department  employees  are 
checked  by  general  reports  on  their  daily  work.  Stenog- 
raphers and  billers  are  checked  periodically  as  to  speed 
and  accuracy. 

Every  morning  a  report  is  made  from  our  time-clock 
and  placed  on  my  desk.  This  enables  me  to  see  what 
employees  registered  late  and  those  who  have  not  re- 


150 DEVELOPING   YOUR   MEN 

ported.  We  do  not  dock  a  late  employee  or  one  who  is 
on  the  sick  list.  An  employee  registering  late  puts  a  red 
circle  around  his  late  mark.  If  this  happens  regularly 
the  department  head  calls  the  employees'  attention  to 
the  fact  and  an  explanation  is  in  order. 

Whenever  anything  goes  wrong  with  an  employee's 
work  or  discipline,  we  do  not  call  his  attention  to  the 
error  in  the  hearing  of  other  employees.  Whenever  an 
employer  places  an  employee  in  an  embarrassing  position 
before  others,  he  needlessly  creates  a  sore  spot  in  the 
employee's  mind  which  is  bound  to  react  on  the  effi- 
ciency of  the  work  and  in  many  cases  on  the  attitude  of 
other  employees.  We  use  inserts  in  our  pay  envelopes  to 
call  attention  to  trivial  errors  on  the  part  of  employees 
and  the  more  serious  things  are  taken  up  in  person  by 
the  department  manager  or  myself  in  the  office. 

What  we  aim  to  do  is  to  make  our  employees  glad  to 
work  for  and  with  our  company.  We  want  them  to  feel 
that  we  not  only  do  appreciate  their  earnest  efforts, 
but  that  we  are  always  ready  to  pay  for  good  work  well 
done.  We  try  to  make  them  realize  that  there  is  a  place 
at  the  top  for  the  man  who  makes  good. 


WE  TRY  never  to  hire  a  man  who  cannot  smile.     We 
know  that  a  habitual  "grouch",  if  he  happens  to  be 
in  our  employ,  is  a  sure  source  of  complaints.     The  man, 
however,  who  is  naturally  friendly,  who  has  a  smile  just 
under  the  surface,  will  make  and  keep  friends  for  us. 

E.  M  STATLER, 

President  of  Hotels  Statler  Company,  ID«. 


PART  IV-PUTTING  MORE 

THAN  MONEY  IN  PAY 

ENVELOPES 

Making-  Partners  of  Workers 


biggest  problem  of  the  employer  is  to  pro- 
*  vide  a  stable,  happy  operating  force  which  will 
work  with  him  as  well  as  for  him.  It  is  the  prob- 
lem of  every  business  —  whether  the  business  em- 
ploys five  men  or  nearly  a  quarter  of  a  million 
men,  as  in  the  case  of  the  United  States  Steel 
Corporation. 

As  the  number  of  men  increases,  the  complexi- 
ties increase  and  the  impersonal  character  of  the 
corporation  enters.  Reduced  to  their  elements, 
however,  big  business  and  little  business  have 
much  the  same  points  to  be  solved.  They  each 
have  the  individual  workman  eventually  to  deal 
with;  no  matter  how  pretentious  the  plan,  it  will 
fail  unless  the  individual  is  the  controlling  con- 
sideration —  unless  the  plan  makes  "boosters"  out 
of  "kickers." 

The  great  thing  is  not  only  to  make  the  man 
working  for  wages  actually  a  partner  interested 
with  the  employer,  but  to  let  him  show  that  he 
has  such  a  relation  and  that  his  welfare  and  the 
welfare  of  the  employer  are  identical.  When  this 
basis  is  established  most  differences  will  solve 
themselves. 


JAMES  A.  FARRELL 

President  of  the  United  States  Steel  Corporation 


XV 

PROFIT  SHARING- 
ITS  SUCCESSES  AND  FAILURES 

By  Boyd  Fisher, 
Vice-president  of  the  Executives'  Club  of  Detroit 

CONSIDERED  merely  as  a  stimulus  to  increased  pro- 
duction and  greater  net  gains,  profit  sharing  is  of 
particular  value  in  plants  where : 

(a)  Individual    efficiency    can    not   yet    be    exactly 
measured,  or  where — 

(b)  Much  work  is  done  away  from  supervision,  or 
where — 

(c)  Longevity  of  service  is  necessary  to  preserve  qual- 
ity of  product  or  to  guard  trade  secrets,  or  where — 

(d)  A  supplement  to  wage-payment  systems  promot- 
ing individual  efficiency   is  needed  to  minimize  plant 
waste. 

In  other  cases,  where  the  motives  are  merely  practical, 
better  results  are  obtained  by  improvements  in  working 
conditions,  by  increases  in  wages  equal  to  the  desired 
share  in  the  profits,  and  by  the  payment  of  these  in- 
creased wages  upon  the  basis  of  individual  efficiency. 

There  are,  in  other  words,  limitations  upon  profit  shar- 
ing as  an  economic  incentive.  In  all  the  four  cases  listed 
it  succeeds  in  increasing  individual  efficiency  only  by 
influencing  the  entire  working  force. 

Its  effect  is  like  opening  a  window  in  a  superheated 
school  room — it  increases  the  alertness  of  individuals  by 
freshening  the  air  for  the  whole  class.  For  bettering 


154 HELPING  LOYALTY   HELP  YOU 

results  in  regard  to  the  factors  that  apply  equally  to  the 
whole  working  force,  like  the  minimizing  of  waste  and 
idleness,  the  reduction  of  needed  supervision  and  the 
breeding  of  good  will  between  workers,  it  is  admirable 
when  sincerely  undertaken.  But,  just  as  no  school 
teacher  would  expect  to  get  the  best  work  from  a  class 
of  children  by  merely  providing  proper  heat  and  ventila- 
tion, so,  no  manager  should  expect  to  obtain  the  best 
output  from  each  man  by  merely  creating  a  good  work- 
ing spirit. 

Profit  sharing  is  probably  impotent,  in  its  direct 
effects,  to  stimulate  output.  While  the  workman  may 
hope  that  everybody  will  work  hard  enough  to  increase 
his  share  of  the  profits,  he  hardly  grasps  the  point  of  his 
working  harder  to  increase  everybody's  share.  It  is 
beyond  his  field  of  vision. 

PROFIT  sharing  for  employees  under  most  conditions 
is  profit  making  for  the  business  only  when  a  strong 
personal  incentive  impels  the  men  to  increased  effort. 

Only  an  individual  incentive  will  produce  the  ut- 
most individual  results.  Only  a  piecework,  premium  or 
bonus  system  of  pay,  based  upon  a  definite  and  scien- 
tifically-established task,  will  stimulate  the  fullest  output 
of  which  the  operative  is  normally  capable. 

The  task  idea  is  to  be  strongly  favored  as  an  addition 
to  profit  sharing.  If  a  choice  must  be  made  between 
them — though  there  is  no  practical  difficulty  in  combin- 
ing them — the  task  idea  is  preferable. 

In  spite  of  the  limitations  restricting  profit  sharing, 
however,  and  apart  from  the  altruistic  justifications  of 
the  idea,  there  are  certain  situations  in  business  in  which 
profit  sharing  for  the  men  is,  at  the  same  time,  profit 
making  for  the  business.  The  first  of  these  is  the  con- 


HAS   PROFIT   SHARING   MADE   GOOD?        155 

Jition  where  individual  efficiency  can  not  yet  be  exactly 
measured. 

Advanced  protagonists  of  scientific  management  do 
not  admit  that  any  field  of  work  exists  which  can  not 
in  the  course  of  time  be  standardized.  They  admit, 
however,  that  some  kinds  of  manual  labor  do  not  yet 
admit  of  exact  measurement.  There  are  assuredly  many 
which  managers  have  not  attempted  to  measure. 

These  classes  of  work  suffer  from  the  disadvantages 
which  business  men  are  most  ready  to  point  out  when 
labor  advocates  demand  uniform  wage  scales.  They  do 
not,  that  is  to  say,  stimulate  initiative  and  hope ;  they  do 
not  permit  rewards  for  individual  care  and  skill. 

It  is  in  industries  in  which  such  conditions  prevail 
that  profit  sharing  is  especially  to  be  commended.  Where 
workmen  can  not  be  individually  rewarded  for  extra 
effort,  they  can  be  encouraged  to  greater  cooperation  by  a 
share  in  the  gains  of  their  joint  labor. 

Sometimes  it  is  only  one  or  two  departments  in  a 
plant  which  suffer  from  these  handicaps.  The  Metal 
Products  Company  in  Detroit  meets  a  situation  where 
from  twenty-five  to  fifty  men  work  in  a  gang  assembling 
axles,  and  the  like,  by  paying  the  entire  gang  a  piece 
rate. 

A  business  which  apparently  has  to  work  its  entire 
force  as  one  big  gang  is  The  Procter  and  Gamble  Com- 
pany, which  manufactures  soap  and  other  products  at 
Ivorydale,  Ohio.  When  I  visited  this  plant  I  was  im- 
pressed with  the  huge  vats  of  Ivory  Soap,  three  stories 
high,  containing  275,000  pounds  of  material,  which  are 
kept  constantly  boiling  for  seven  days. 

Obviously  it  would  be  impossible  to  measure  the  con- 
tributions of  all  the  shifts  and  workmen  in  the  making 
of  one  of  these  vats  of  soap.  The  company  can  only 


156 HELPING   LOYALTY   HELP  YOU 

promote  a  general  spirit  of  loyalty  and  interest  in  the 
business  by  first  picking  intelligent,  conscientious  men, 
and  then  rewarding  them  with  a  share  in  the  profits  of 
the  company.  The  Procter  and  Gamble  Company  has 
done  this  by  means  of  a  stock-sharing  scheme  which  has 
become  the  model  for  the  country. 

Another  class  of  business  which  does  not  easily  admit 
of  standards  for  measuring  efficiency,  and  which,  there- 
fore, is  a  proper  field  for  profit  sharing,  is  the  manu- 
facture of  illuminating  gas.  The  great  metropolitan 
gas  companies  of  England  were  the  first  to  recognize 
this,  and  they  have  for  twenty  years  maintained  a  profit- 
sharing  plan  that  links  up  features  involving  saving 
funds  and  stock  sharing.  The  Boston  Consolidated  Gas 
Company,  in  this  country,  has  a  profit-sharing  scheme. 

In  fact,  we  may  say  that  all  businesses  which  handle 
large  quantities  of  raw  material  are  likely  to  involve 
processes  in  which  individual  efficiency  can  not  be  meas- 
ured. The  Solvay  Process  Company  of  Syracuse  and 
Detroit,  the  Edison  Electric  Illuminating  Company  of 
Brooklyn  and  the  General  Ice  Delivery  Company  of 
Detroit  all  fall  under  this  heading  and  all  use  profit- 
sharing  plans. 

Another  business  which  many  people  may  contend 
can  not  be  fairly  standardized  is  the  printing  business. 
This  contention  is  held  open  to  dispute.  But  it  is  well 
to  classify  the  profit-sharing  plan  used  by  the  Houghton 
Mifflin  Company  at  Boston  as  one  which  owes  its  validity 
ito  the  fact  that  a  more  definite  incentive  could  not  be 
discovered. 

There  is  another  type  of  business  in  which  there  exists 
a  similar  reason  for  sharing  profits:  where  a  large  por- 
tion of  the  work  is  clone  away  from  supervision,  very 
much  the  same  difficulty  in  appraising  the  faithfulness 


HAS  PROFIT  SHARING   MADE   GOOD?        157 


of  the  average  worker  appears.  In  all  such  businesses 
the  expedient  of  making  the  workman  a  partner  with 
the  management  not  alone  gives  him  an  interest  in  the 
results  of  good  work,  but  also  puts  him  on  honor  toward 
his  fellow  workmen  to  do  his  best,  whether  adequately 
supervised  or  not. 

SOME  of  the  history  of  early,  but  successful,  profit- 
sharing  plans.     Most  plans  of  this  nature  are  di- 
rectly pointed  toward  stabilizing  the  working  force. 

The  first  profit-sharing  scheme  to  attain  great  success- 
because  of  this  principle  was  that  inaugurated  by  Leclaire 
in  1842.  The  Maison  Leclaire  was  a  house-painting  com- 
pany in  Paris.  Quite  obviously,  when  two  or  three 
painters  are  dispatched,  with  or  without  a  foreman,  they 
can  not  be  supervised  as  closely  with  regard  to  how  fast 
or  how  thoroughly  and  carefully  they  do  their  work  as 
can  operatives  in  a  manufacturing  plant.  They  are  too 
far  removed  from  supervision. 

The  latter  are  always  to  be  found  in  an  assigned 
station  and  are  inspected  from  time  to  time  in  a  routine 
way.  But  if  paint  be  improperly  mixed  or  badly 
applied,  the  negligence  does  not  show  immediately.  And 
if  the  company  is  never  asked  to  paint  the  same  house 
again,  the  management  has  no  way  of  knowing  whether 
the  loss  of  business  was  due  to  carelessness  on  the  part 
of  the  workmen  or  not. 

It  is  reasonably  certain  that  Leclaire 's  motive  in  estab- 
lishing a  profit-sharing  scheme  was  purely  altruistic, 
because,  merely  to  secure  good  work,  he  did  not  need 
to  go  so  far  as  he  did  in  making  the  workmen  in  his 
company  owners  of  the  stock  in  it.  But  it  is  also  true 
that  the  success  of  his  plan  came  mainly  from  the  fact 
that  profit  sharing  proved  to  be  such  an  effective  cor- 


158 HELPING  LOYALTY   HELP   YOU 

rective  of  careless  workmanship  that  it  greatly  increased 
the  earnings  of  his  business. 

Another  French  example  of  profit  sharing  is  the  Bon 
Marche,  a  department  store  in  Paris  with  an  annual 
turnover  of  forty-five  million  dollars.  Today  all  of  the 
company's  nine  million  dollars'  worth  of  stock  is  held 
by  either  present  or  retired  workers. 

This  profit-sharing  scheme,  which  was  inaugurated  in 
1880,  does  not  owe  its  inception  to  the  difficulty  of 
supervising  the  retail  sales  force.  Lime.  Aristide  Bouci- 
caut,  the  widow  of  the  founder  of  the  business,  made 
the  principal  assistants  partners  with  her  in  order  that 
she,  although  inexperienced  herself  in  merchandising, 
might  secure  loyal  service  with  less  direction.  The  plan 
was  extended,  however,  to  all  her  workers  and  succeeded  • 
mainly  because,  although  supervision  is  possible  in  a 
department  store,  it  is  not  generally  effective  unless  the 
members  of  the  sales  force  are  keenly  interested  in  the 
welfare  of  each  customer. 

Every  manufacturer  realizes  the  importance  of  a 
stable  working  force.  Most  profit-sharing  plans,  in  fact, 
look  more  to  stabilizing  the  force  than  to  increasing 
profits  through  the  incentive  of  larger  volumes  of  pro- 
duction. The  mere  cost  of  hiring  and  breaking  in  new 
men,  running  according  to  various  estimates  all  the  way 
from  twenty-five  dollars  to  two  hundred  dollars  per 
man,  is  a  potent  incentive  to  the  adoption  of  methods 
for  binding  men  more  closely  to  their  jobs. 


r  I^HE  business  world  needs  today  more  who  are  willing  to 
A  listen  to  the  opinions  of  others  and  weigh  them. 

CLARENCE  M.  WOOLLET, 

President  of  the  American  Radiator  Company 


XVI 

PROFIT  SHARING: 
WHEN?    WHY?    HOW? 


By  James  A.  Farrell, 
President  of  the  United  States  Steel  Corporation 


THE  Steel  Corporation  has  given  a  vast  amount  of 
thought  and  many  millions  of  dollars  to  the  promot- 
ing of  a  mutual  interest  with  its  workers.  Our  systems  are 
working  out  very  satisfactorily,  and  I  think  they  are 
resulting  thus  happily  because  they  are  founded  upon 
the  individual  instead  of  being  forced  upon  him. 

The  entire  system  is  planned  with  the  thought  of 
securing  the  active  cooperation  of  the  individual  work- 
man for  his  own  and  for  the  company's  benefit.  And 
I  think  that  we  have  removed  every  trace  of  the  unfor- 
tunate antagonism  that  sometimes  obtains  between  cap- 
ital and  labor.  The  men  feel  that  the  corporation  is 
vitally  interested  in  them  and  does  not  consider  them  as 
tools  to  be  worn  out  and  thrown  aside. 

The  whole  work  of  making  the  employee  an  integral 
part  of  the  corporation  divides  itself  into  four  broad 
heads : 

1.  Stock-purchasing  plan 

2.  Pension  and  relief 

3.  Safety    first — the    guarding    of    the    men    from 
injury 

4.  Welfare — the  bettering  of  conditions  of  work  and 
housing 


160 HELPING  LO/ALTY   HELP   YOU 

Each  of  these  activities  has  done  its  part  toward  caus- 
ing the  employees  to  cooperate  with  one  another  and 
with  the  corporation.  One  activity  can  hardly  be  pre- 
ferred to  another  as  the  more  valuable  in  contributing 
to  the  sentiment  of  mutual  interest.  One  man  may  best 
like  the  opportunity  to  make  money  on  his  stock;  an- 
other man  may  work  well  because  he  sees  a  pension 
ahead;  while  still  another  may  most  deeply  appreciate 
the  safeguards  and  healthful  conditions  about  his  work. 

HOW  it  has  been  made  possible  for  employees  to  be- 
come  stockholders.     $12,000,000  is  available   for 
pensions  and  relief  work  among  workers. 

The  first  of  the  plans  to  give  the  employee  a  share  in 
the  corporation's  earnings  was  adopted  in  1903,  when 
the  stock  subscription  plan  was  inaugurated.  It  is 
profit  sharing  in  the  best  sense  because  the  employee  is 
urged  to  pool  his  fortunes  with  the  company  by  buying 
stock  out  of  his  savings.  The  employee  thus  gains  an 
interest  identical  with  the  larger  stockholders  and  no 
additional  self-interest  is  interposed  between  the  corpo- 
ration and  its  owners — the  stockholders. 

"When  the  plan  was  put  into  effect  it  was  not  generally 
understood  by  the  employees,  many  of  whom  had  very 
vague  ideas  as  to  what  stock  was.  But  the  officers  of  the 
corporation  explained  the  nature  of  the  investment  to 
the  men  everywhere  and  now  some  fifty  thousand  em- 
ployees hold  approximately  one  hundred  and  fifty  thou- 
sand shares  of  stock. 

The  plan  is  very  simple.  The  company  acts  as  the 
purchasing  agent  of  stock  for  the  men.  The  number  of 
shares  to  which  any  employee  may  subscribe  is  graded 
According  to  his  salary,  the  relative  proportion  being 


PARTNERS  AND   PROFITS 161 

greater  for  the  earners  of  low  wages  than  for  the  earners 
of  higher  wages.  He  takes  the  stock  at  somewhat  less 
than  the  current  market  price,  and  pays  for  it  in  monthly 
instalments.  The  minimum  payments  vary  according  to 
the  market  price  of  the  stock  and  run  from  two  dollars 
to  three  dollars  per  month  for  the  preferred  to  between 
one  dollar  and  twenty-five  cents  and  one  dollar  and  fifty 
cents  for  the  common.  A  workman  is  not  permitted  to 
pay  in  more  than  twenty-five  per  cent  of  his  monthly 
earnings.  The  company  adds  to  the  stock  thus  pur- 
chased a  premium  or  bonus  during  the  first  five  years; 
this  is  five  dollars  a  year  for  each  share  of  stock. 

If  a  subscription  is  not  paid,  the  employee  may  cancel 
it.  What  he  has  paid  will  be  returned  to  him  with  five 
per  cent  interest.  Premiums  are  not  paid  to  those  who 
cancel  their  subscriptions,  sell  their  stock  or  leave  the 
employment  of  the  company.  These  forfeited  or  unpaid 
premiums  are  thrown  into  a  fund  to  be  divided  pro  rata 
among  the  remaining  subscribers  at  the  end  of  the  five- 
year  period.  If  the  subscriber  dies  before  he  has  com- 
pleted his  payments,  the  premiums  are  paid  to  his  estate 
for  the  full  five-year  period. 

The  men  are  real  stockholders  and  not  mere  recipients 
of  the  company's  largess.  They  earn  their  stock  with 
their  own  money  and  they  are  vitally  interested  in  the 
progress  of  the  corporation.  Before  annual  meetings 
the  stockholders  in  many  of  the  plants  elect  representa- 
tives to  go  to  the  meeting.  They  do  this  entirely  of  their 
own  volition  and  not  through  any  prompting  on  the  part 
of  the  officers.  These  men,  their  expenses  being  paid  by 
their  constituents,  attend  the  meeting,  and  many  of 
them  speak  from  the  workingmen's  point  of  view.  They 
enter  actively  into  the  deliberations  and  make  valuable 
suggestions.  Nothing  could  be  finer  than  the  effect  of 


162 HELPING   LOYALTY   HELP   YOU 

this  mingling  of  the  workers  in  the  field  with  the  more 
or  less  absentee  stockholders.  The  exchange  of  ideas 
is  infinitely  helpful. 

We  like  to  have  the  men  know  that  if  they  stand  by 
us  during  their  active  years,  we  will  take  care  of  their 
old  age.  Hence  the  pension  fund,  which  amounts  to 
twelve  million  dollars,  one-third  having  been  contrib- 
uted by  Mr.  Andrew  Carnegie  and  the  balance  by  the 
Steel  Corporation.  Pensions  are  paid,  after  twenty 
years  of  service,  to  men  above  the  age  of  sixty-five,  and 
to  women  after  the  age  of  fifty-five,  on  the  basis  of  one 
per  cent  of  the  average  monthly  earnings  for  the  last 
ten  years  before  retirement,  multiplied  by  the  number 
of  years  of  service.  The  minimum  pension  is  twelve 
dollars  per  month  and  the  maximum  is  one  hundred  dol- 
lars per  month.  The  average  is  twenty  dollars  and 
thirty  cents.  The  number  of  pensioners  is  now  a  little 
over  three  thousand. 

OAFEGUARDING  the  employee  at  work.  How  the 
^~J  safety-first  committee  operates.  How  the  men  help 
the  committee  and  why  it  pays. 

The  accident  relief  plan  was  started  in  1910;  it  is 
now  superseded  by  the  compensation  laws  of  the  states 
in  many  places.  The  essential  feature  was  the  entire 
disregarding  of  legal  liability  or  formality  in  applica- 
tion. During  one  year  the  various  companies  paid  an 
aggregate  of  $2,564,839,  which  was  eighty-five  per  cent 
of  all  the  expenditures  in  casualty  matters.  Suits  were 
brought  in  less  than  a  quarter  of  one  per  cent  of  all 
accidents. 

The  safety-first  campaign  has  not  only  saved  nearly 
thirteen  thousand  persons  from  serious  injury  within 
the  past  six  years,  but  it  has  given  a  new  angle  and  a 


PARTNERS   AND   PROFITS 163 

new  interest  to  every  man's  job.  The  subsidiary  com- 
panies had  been  working  out  means  of  protecting  men 
at  work  for  many  years,  but  the  organization  for  the 
whole  corporation  dates  from  1906,  when  the  central 
bureau  was  established  as  a  clearing  house  for  ideas. 

The  result  was  the  appointment  of  a  committee  of 
safety  and  the  establishment  of  a  bureau  of  safety — to 
which  was  added  three  years  ago  control  of  relief,  sani- 
tation, and  welfare.  I  think  the  success  of  the  measures 
has  been  very  largely  due  to  the  method  of  organization, 
which  divides  and  subdivides  until  the  workman  him- 
self actually  participates. 

At  the  head  is  the  bureau,  which  is  the  executive  de- 
partment of  the  committee  of  safety.  This  committee 
has  one  of  the  officers  of  the  Steel  Corporation  as 
chairman ;  the  seven  other  members  represent  the  larger 
subsidiary  companies.  The  bureau  and  the  committee 
aim  to  circulate  the  best  ideas  of  the  whole  membership 
of  the  organization  in  order  that  each  plant  may  have 
the  benefit  of  the  ingenuity  of  all  the  other  plants. 
Then  come  the  central  safety  committees,  which  do 
for  the  plants  of  each  subsidiary  company  what  the 
main  committee  does  for  the  whole  body  of  companies. 
Each  plant  has  its  own  plant  safety  committee,  com- 
posed of  important  officers,  below  which  is  the  depart- 
ment committee  of  foremen,  master  mechanics,  and 
skilled  workmen,  and  finally  the  workmen's  safety  com- 
mittee, which  is  drawn  from  the  rank  and  file. 

These  committees  all  meet  regularly,  some  of  them 
every  week,  and  they  make  frequent  inspections  of  their 
own  and  of  other  plants,  with  the  sole  idea  of  suggesting 
ways  and  means  for  the  safeguarding  of  the  work. 
Every  accident  is  reported  on  a  form  which  contains  a 
space  headed:  "Suggestion  for  prevention  of  a  similar 


164 HELPING   LOYALTY   HELP   YOU 

accident."  These  forms  are  tabulated  and  each  plant 
has  its  score  board  to  stimulate  competition,  not  only 
between  departments  of  the  same  plant,  but  also  between 
the  various  companies.  When  no  suggestion  for  the  pre- 
vention of  "a  similiar  accident"  is  made,  the  details 
of  the  accident  are  sent  out  to  all  of  the  committees  and 
they  are  asked  to  suggest  ways  and  means. 

The  same  procedure  is  followed  with  new  devices  for 
safety  or  welfare.  The  workman  himself  has  the  chance 
to  suggest  what  he  thinks  will  best  prevent  a  recurrence 
— it  is  put  up  to  him.  The  membership  of  the  work- 
men's committees  is  changed  frequently,  in  order  that 
every  man  may  eventually  pass  through  the  stage  of 
accident-prevention  supervision;  thereafter  that  man 
will  be  a  part  and  parcel  of  the  safety  and  the  welfare 
system.  More  than  eight  thousand  workmen  have 
already  served  on  these  committees. 

Without  the  active  interest  of  the  men  most  con- 
cerned, any  safety  or  welfare  measures  will  cause  resent- 
ment and  will  therefore  fail.  We  met  this  condition  at 
the  beginning  of  the  work.  Most  of  the  superintendents 
and  foremen  had  come  up  through  the  mills,  and  they 
thoroughly  believed  in  the  doctrine  that  every  man 
ought  to  be  amply  able  to  look  out  for  himself.  They 
did  not  like  the  idea  of  someone  interfering  with  their 
jobs,  but  we  found  they  would  work  with  zeal  if  the 
details  of  the  new  idea  were  put  squarely  up  to  them 
for  solution. 

Take  a  typical  case  in  a  carpenter  shop.  An  order 
went  out  to  install  saw  guards  and  with  it  a  design  for 
a  guard.  The  superintendent  received  the  new  device 
with  a  contemptuous  sniff. 

"That  thing  isn't  a  guard.     It  will  kill  someone," 


PARTNERS   AND   PROFITS 165 

he  said.     The  safety-first  man  took  him  tactfully  and 
replied  : 

"Well,  Bill,  you  must  have  some  kind  of  a  guard. 
Make  up  a  better  one  and  I  will  send  it  out  to  the  other 
plants. ' ' 

And  the  new  guard  was  made  and  it  was  the  best 
guard  for  that  shop  because  it  was  a  home  product. 
We  have  possibly  twenty-five  designs  of  guards  now  in 
use  and  they  are  all  good.  One  man  wants  a  mesh  guard 
so  that  he  can  see  the  gears ;  another  declares  that  the 
guard  must  be  solid  in  order  to  keep  out  the  dust  and 
preserve  the  life  of  the  gears. 

The  initial  opposition  once  overcome,  the  difficulty 
has  not  been  in  regard  to  securing  new  safety  or  welfare 
devic.es,  but  in  preventing  useless  or  too  costly  installa- 
tions. The  men  who  kicked  most  at  the  beginning  are 
the  men  who  must  now  be  watched  so  that  their  enthusi- 
asm does  not  override  their  judgment.  Every  man, 
whether  he  receives,  wages  or  a  salary,  is  eagerly  enlisted 
and  is  anxious  to  come  out  with  some  winning  idea. 
I  have  seen  common  laborers  conferring  with  five-figure 
managers  over  the  best  way  of  avoiding  some  simple 
accident. 

The  bureau  gives  currency  to  every  good  idea.  Thou- 
sands of  ideas  are  being  interchanged.  Among  those 
now  under  consideration  are  safety  devices  for  ladders. 
"We  formerly  had  spikes  and  safety  feet  on  all  portable 
ladders,  but  accidents  continued  to  happen.  One  of 
the  plants  made  an  exhaustive  series  of  experiments 
with  ladders  bearing  different  weights  and  with  various 
types  of  feet  to  determine  the  angles  at  which  a  ladder 
bearing  the  average  man  would  slip.  They  found  that 
the  ordinary  ladder  was  not  safe  on  a  smooth  or  oily 
surface  if  inclined  at  an  angle  greater  than  sixty  de- 


166 HELPING  LOYALTY   HELP   YOU 

grees.  They  found  that  neither  the  spikes  nor  the  safety 
feet  helped  matters  and  they  recommended  a  plain  lad- 
der with  a  man  holding  it  when  the  angle  increased  to 
sixty  degrees  or  beyond.  Now  we  are  going  to  adopt 
a  simple  little  device  which  will  show  the  danger  angle 
for  ladders. 

All  of  this  costs  money.  The  total  cost  of  the  meas- 
ures for  workmen  for  two  successive  years  was  $7,240,- 
669.33,  and  $6,017,848.28.  We  are  spending  from  a  half 
million  to  a  million  dollars  each  year  on  accident  preven- 
tion alone.  Reduced  to  a  per  capita  basis  it  amounted 
to  $2.84  one  year  and  $3.01,  and  $3.32  each  for  the  fol- 
lowing years. 

Does  it  pay?  We  think  it  does.  An  industrial  enter- 
prise must  be  so  conducted  that  it  shall  earn  enough  to 
insure  proper  working  conditions  for  its  employees,  to 
pay  fair  wages  and  to  return  a  reasonable  profit  to  those 
who  have  invested  their  money  in  it. 

Our  plans  are  large  because  our  work  is  large.  But 
the  principle  which  guides  us  is  equally  applicable  to 
the  smallest  manufacturer.  The  cost  of  pension,  safety, 
and  welfare  work  must  be  adjusted  to  the  means  of  the 
owners.  But,  taking  the  initiative  of  the  workmen  as 
the  foundation,  the  adaptation  of  the  principle  and  its 
ramifications  becomes  onlv  a  matter  of  mathematics. 


THERE  are  three  important  actors  in  production — the 
equipment,   the  systems    employed,    and    the    human 
element.     It  is  more  and  more  being  appreciated  that  the 
human  element  is,  in  the  last  analysis,  the  one  most  im- 
portant in  securing  the  results  desired. 

LUTHER  D.  BURLINGAME, 

Industrial  Superintendent,  Brown  and  Sharpe 
Manufacturing  Company 


XVII 

GIVING  THE  MEN  A  CHANCE- 
WHAT  IT'S  DOING  FOR  FORD 

By  Harry  Franklin  Porter, 
Organization  Engineer 

MY  FIRST  introduction  to  the  Ford  plant  and  to 
Henry  Ford  was  in  the  late  spring  of  1913. 
Although  some  of  the  most  'noteworthy  developments  in 
the  short  but  eventful  history  of  the  Ford  enterprise 
have  taken  place  since  that  time,  Henry  Ford  already 
was  enjoying  nation-wide  distinction  as  a  manufacturer. 
The  annual  convention  of  the  National  Association  of 
Manufacturers  was  being  held  in  Detroit  and  Mr.  Ford 
was  one  of  the  guests  at  the  banquet.  "When  it  became 
known  that  he  was  in  the  room,  almost  the  sole  topic  of 
conversation  at  the  outlying  tables  was  Henry  Ford  and 
his  methods. 

A  local  manufacturer  sat  at  my  table  and,  as  I  per- 
sonally was  eager  to  learn  more  about  Mr.  Ford,  I 
encouraged  him  to  talk.  He  corroborated  many  of  my 
previous  impressions  and  filled  in  many  interesting 
details.  He  was  not,  however,  wholly  laudatory  in  his 
remarks.  As  to  the  merit  of  Ford's  mechanical  methods 
he  had  nothing  but  praise.  But  as  an  employer  of  labor 
he  criticized  him.  "He  pays  low  wages  and  hires  the 
cheapest  class  of  help,  mostly  foreigners,"  was  my  table- 
mate's  remark;  "and,"  he  added,  "there  is  considerable 
feeling  against  him  among  Detroit  manufacturers." 


168 HELPING  LOYALTY   HELP   YOU 

Just  how  much  justice  there  was  in  this  criticism  I 
was  unable  to  learn.  I  must  confess  that  I  was  skeptical. 
I  knew  that  one  of  the  reasons  for  Ford's  success  was 
the  extent  to  which  he  had  carried  the  subdivision  of 
labor,  eliminating  the  necessity  for  any  great  skill  on 
the  part  of  many  of  his  operatives.  But  I  had  also 
visited  the  plant  and  came  away  impressed  with  the 
excellence  of  the  working  conditions,  the  emphasis  on 
good  light,  ventilation  and  sanitation,  the  provisions  for 
safety,  and  the  cheerful,  busy  atmosphere  of  the  place. 
Therefore  I  was  unwilling  to  believe  that  his  methods 
as  to  men  could  be  classed  as  retrogressive. 

One  of  the  officials  of  the  Ford  Motor  Company,  how- 
ever, in  a  speech  before  the  Indianapolis  Chamber  of 
Commerce,  early  in  1915,  in  leading  up  to  an  explanation 
of  the  Ford  profit-sharing  plan,  made  the  following 
admission :  ' '  We,  like  other  employers,  had  gone  on 
for  years,  hiring  men  at  the  back  door  for  as  little  as 
we  could  get  them,  putting  them  in  the  shop  and  making 
them  work  at  the  same  job  as  long  as  they  would  stick, 
and  not  giving  them  an  advance  until  we  had  to." 

Then  the  tremendous  wastes  in  this  method  of  hiring 
and  handling  men  began  to  dawn  upon  the  Ford  officials. 
They  had  not  been  exactly  retrogressive  in  their  labor 
policy,  but  they  had  unconsciously  been  following  the 
line  of  least  resistance.  The  result  was  that  the  number 
of  five-day  men,  or  "floaters,"  was  very  large.  Some 
months  it  was  necessary  to  hire  new  men  to  the  extent 
of  55  per  cent  of  the  total  payroll.  "When  it  is  con- 
sidered that  the  force  comprised  some  seventeen  thousand 
men,  an  idea  can  be  had  of  the  immensity  of  the  task. 
The  long  employment  line  in  front  of  the  Ford  plant 
had  become  one  of  the  sights  used  to  whet  the  curiosity 
of  "rubber-neck"  tourists. 


Accordingly,  a  broad  survey  of  the  entire  labor  situa- 
tion was  undertaken.  Other  plants  employing  about 
the  same  number  of  men  were  visited,  during  the  course 
of  the  investigation,  but  none  with  a  better  system  was 
found.  Nothing  daunted,  the  Ford  heads  determined 
to  solve  the  problem  in  their  own  way.  In  the  grading 
of  employees  they  found  great  lack  of  uniformity.  This 
matter  had  been  largely  in  the  hands  of  the  foremen. 
As  a  result,  operatives  in  different  departments,  and 
even  in  the  same  department,  were  doing  virtually  iden- 
tical work,  but  were  getting  widely  varying  rates  of  pay. 

FORD  finds  out  just  how  skilful  a   workman  each 
employee  is.     Wages  are  based  on  these  findings 
and  the  plan  has  proved  mutually  satisfactory. 

The  number  of  different  rates,  moreover,  was  entirely 
too  large.  Therefore,  as  the  first  step,  a  comprehensive 
classification  of  skill  was  worked  out.  This  was  as 
original  as  it  has  been  successful. 

All  the  work  was  found  to  fall  approximately  into 
six  different  groups,  or  classes,  of  skill.  Each  of  these 
divisions,  or  groups,  in  turn  was  subdivided  into  three 
groups — the  beginners,  those  of  average  proficiency,  and 
the  highly  proficient.  An  additional  grade  was  further 
established  in  some  of  the  divisions,  that  of  service,  to 
reward  the  proficient  men  who  had  been  in  the  employ 
of  the  company  continuously  for  two  years  or  over. 
Kates  of  pay  were  fitted  in  accordance.  These  finally 
were  boiled  down  to  eight  rates,  as  against  some  sixty 
rates  that  were  originally  in  force. 

In  no  case  was  a  man's  previous  rate  cut.  On  the 
contrary,  rates  on  the  whole  were  graded  upward,  and, 
when  several  rates  were  condensed  into  one,  the  new 
figure  was  slightly  above  even  the  highest  of  the  ones 


170 HELPING  LOYALTY   HELP  YOU 

it  superseded.  Rates  from  52  to  58  cents,  for  instance, 
were  condensed  to  60  cents;  from  46  cents  to  50  cents, 
to  54  cents,  and  so  on.  ,The  lowest  rate  per  hour  became 
23  cents,  for  messengers  and  other  miscellaneous  special 
labor;  the  highest  65  cents,  for  expert  tool  makers  and 
foremen  in  the  service  for  two  years  or  over. 

Simultaneously  the  power  of  discharge  was  taken 
from  the  foremen  and  vested  in  a  "court  of  appeal" 
working  in  connection  with  the  employment  office.  Now, 
if  a  man  fails  to  get  along  with  his  foreman  he  comes 
before  this  court,  is  carefully  questioned,  plainly  talked 
to  if  at  fault,  and  sent  back  to  work  in  another  depart- 
ment. Often  it  is  a  case  of  a  "square  peg  in  a  round 
hole,"  and  the  man  is  shifted  around  until  the  work 
that  he  can  do  best  is  found.  Of  course,  if  a  man  shows, 
after  two  or  three  trials,  that  he  hasn  't  it  in  him  to  make 
good,  he  is  reluctantly  let  out. 

The  word  "reluctantly"  is  used  advisedly.  It  is  diffi- 
cult as  things  now  are  to  get  into  the  Ford  organiza- 
tion, but  once  in  it  is  perhaps  more  difficult  to  get  out. 
The  Ford  Company  wants  its  men  to  stay. 

In  addition  to  taking  away  the  power  to  discharge 
from  the  foreman,  systematic  reviewing  of  the  record 
of  each  workman  was  also  inaugurated.  If  after  the 
third  pay  day  for  a  new  man,  for  instance,  no  "raise 
slip"  comes  in,  the  foreman  is  sent  for  and  asked  why. 
If  the  man  is  entitled  to  promotion,  but  the  matter 
simply  has  slipped  the  attention  of  the  foreman,  the 
latter  is  taken  to  task  for  his  carelessness.  He  is  also 
reproved  if  his  failure  to  send  in  a  slip  is  due  to  the 
man's  inefficiency.  He  must  not  allow  his  department 
to  be  cumbered  with  a  failure. 

The  toning-up  effect  of  these  measures  can  readily  be 
appreciated.  Men  no  longer  are  at  a  disadvantage 


GIVING  THE   MEN  A   BIGGER  CHANCE      171 

because  they  happen  to  have  incurred  the  dislike  of  their 
foremen.  They  are  stimulated  by  the  fact  that  the  com- 
pany is  taking  a  personal  interest  in  their  welfare,  and 
the  new  classification  of  skill  remedies  many  injustices 
in  the  wage  scale.  The  foremen,  moreover,  are  aroused 
to  a  new  sense  of  their  responsibilities. 

What  the  tangible  results  of  the  various  measures 
inaugurated  to  insure  more  substantial  justice  to  the 
individual  workmen  were  at  the  start  are  shown  by  the 
following  figures: 

December,  1912  October,  1913 

Five-day  men    3,594  322 

Men   discharged    776  137 

Men  quitting   386  326 

Men  laid  off 4,622  844 

Total  hired    5,678      .  1,789 

Gain  for  the  month 856  954 

The  decrease  in  the  number  of  five-day  men,  or 
"floaters,"  is  particularly  significant,  since  it  indicates 
that  permanency  of  the  force  was  being  achieved.  The 
decrease  in  the  number  discharged  also  is  noteworthy, 
and  points  to  the  success  of  the  method  of  shifting 
men  about  until  they  make  good,  rather  than  letting 
them  out  on  their  first  fall-down.  The  direct  saving  to 
the  company  through  the  greatly  lessened  employment 
expense  was  large,  but  the  indirect  saving  through  the 
greater  etficiency  of  a  reasonably  permanent  and  con- 
tented working  force,  although  more  difficult  to  measure, 
was  undoubtedly  much  larger.  A  decided  decrease  in 
the  number  tardy  or  absent  was  another  result  which 
had  its  financial  compensations. 

The  striking  fact  is  that  Ford  did  not  stop  with  these 
highly  satisfactory  results.  The  company  was  in  a 


172 HELPING   LOYALTY   HELP  YOU 

highly  prosperous  condition,  sales  exceeding  all  expecta- 
tion. The  men  were  receiving  ten  per  cent  more  for 
nine  hours'  work  than  men  in  similar  lines  elsewhere 
in  the  vicinity  were  receiving  for  ten  hours'  work.  In 
addition,  they  were  getting  an  allowance  of  ten  cents  a 
day  for  carfare.  Thus  apparently  there  was  no  exciting 
cause  to  do  anything  further  for  them,  beyond  a  thor- 
oughly aroused  desire  of  the  Ford  Motor  Company  to 
share  its  prosperity  with  its  employees. 

Many  plans  were  considered.  The  idea  of  raising 
wages  still  further  was  dismissed.  Various  profit-shar- 
ing systems  were  investigated  and  they  seemed  unsatis- 
factory. So,  as  before,  the  Ford  management  went  to 
work  and  devised  an  original  plan. 

At  one  stroke  the  company  reduced  the  hours  from 
nine  to  eight,  and  added  to  every  man's  pay  a  share  of 
the  profits.  The  smallest  amount  to  be  received  by  any 
man  22  or  more  years  old  was  five  dollars  a  day.  The 
minimum  wage  previously  was  $2.34  for  a  day  of  nine 
hours.  All  but  ten  per  cent  of  the  employees  at  once 
shared  in  the  profits. 

Only  ten  per  cent  of  the  men  were  under  22,  and 
every  one  of  them  had  a  chance  of  showing  himself 
entitled  to  five  dollars  per  day.  The  factory  had  been 
working  two  shifts  of  nine  hours  each.  This  was 
changed  to  three  shifts  of  eight  hours  each. 

In  order  that  the  young  man  from  18  to  22  years  of 
age  might  be  entitled  to  a  share  in  the  profits,  he  was 
required  to  show  himself  sober,  saving,  steady,  indus- 
trious, and  to  satisfy  the  superintendent  and  staff  that 
his  money  would  not  be  spent  in  extravagant  living. 
Young  men  supporting  families,  widowed  mothers, 
younger  brothers  and  sisters — upon  this  condition — 
were  to  be  treated  like  those  over  22. 


GIVING   THE   MEN   A   BIGGER   CHANCE      173 

This  has  been  called  a  profit-sharing  plan.  But  it  is 
quite  unlike  other  plans  of  profit  division,  nor  does  it 
conform  to  any  orthodox  definition  of  profit  sharing. 
The  fact  that  the  workman's  share  is  predetermined, 
does  not  wait  on  the  earnings  of  the  company  at  the 
end  of  the  year,  and  involves  no  investment  by  the  men 
in  the  stock  of  the  company,  marks  it  as  unusual.  But 
what  makes  the  plan  absolutely  unorthodox  is  the  addi- 
tional fact  that  those  who  earn  the  smallest  wages  get 
the  largest  share  of  the  profits. 

The  plan  has  come  in  for  much  criticism  on  this  score. 
When  asked  to  give  his  reason  Henry  Ford,  in  his 
quaint,  Lincolnesque  manner,  replied:  "Well,  it  costs 
a  sweeper  just  as  much  to  raise  his  family  properly  as 
it  does  a  mechanic  or  anybody  else,  doesn't  it?" 

THE  system  used  to  regulate  the  high  minimum  wage 
paid.     Plans   for    paying  women    workers.     How 
Ford  exercises  an  almost  paternal  watch  over  employees. 

It  should  be  understood  that  the  $5  a  day  is  not  a 
minimum  wage.  The  rates  of  pay  remain  as  before. 
But  to  each  man's  earnings  is  added  a  sufficient  amount 
to  bring  his  total  reward  to  $5.  A  man  who  formerly 
received  23  cents  an  hour,  or  $2.07  for  nine  hours,  now 
receives  the  same  amount  for  eight  hours :  namely,  $2.07 
plus  $2.93  as  his  share  of  the  profits.  The  two  sums  are 
separately  indicated  on  the  pay  envelope.  The  44-cent- 
an-hour  man  receives  $3.96  plus  $1.04  for  each  day  of 
eight  hours. 

Nor  is  $5  the  maximum.  Those  who  before  were  earn- 
ing from  38  to  48  cents  an  hour,  or  the  first-class  skilled 
operatives  and  mechanics  in  the  beginning  grade,  may 
share  in  the  profits  to  the  extent  of  bringing  their  total 
daily  earnings  up  to  $6 ;  while  those  rated  higher  still, 


174 HELPING   LOYALTY   HELP  YOU 

up  to  where  the  salary  class  begins,  may  receive  as  much 
as  $7  a  day.  The  54-cent-an-hour  man's  share  of  the 
profits  at  that  is  only  $2.14,  as  against  $2.93  for  the 
man  rated  lowest.  Salaried  men  do  not  share,  but  are 
taken  care  of  separately  through  a  bonus  plan  which  is 
equivalent. 

At  first  the  only  ones  barred  from  participation  in 
the  profits  were  the  young  men  under  22,  who  had  only 
themselves  to  support.  Later  it  was  found  expedient 
to  include  in  the  non-participants  all  new  men  until 
they  have  been  on  the  payroll  for  six  months.  The  chief 
reason  for  this  change  was  to  discourage  men  in  other 
plants  from  quitting  their  jobs  in  order  to  get  the  higher 
earnings  possible  in  the  Ford  plant.  But  it  also  has  its 
virtue  as  a  means  of  testing  the  intentions  of  newcomers. 
If  they  stick  it  out  six  months  at  ordinary  wages  they 
usually  have  the  necessary  qualities  to  make  them  per- 
manent members  of  the  force.  Again,  it  gives  the  com- 
pany ample  time  to  check  up  on  their  living  habits  and 
financial  status,  and — if  these  are  undesirable — to  im- 
prove them  in  the  meantime  until  they  come  up  to  the 
Pord  standards,  so  that  there  will  be  no  doubt  of  the 
man's  ability  to  qualify  for  participation  in  the  profits 
at  the  end  of  the  six  months. 

Further,  in  order  to  protect  other  plants,  and  to  dis- 
courage the  in-drift  of  men  from  other  cities,  the  Ford 
Motor  Company  now  will  entertain  as  applicants  only 
those  actually  out  of  employment  and  who  have  been 
bona  fide  residents  of  Detroit,  or  the  vicinity,  for  at  least 
six  months. 

At  first  the  plan  of  profit  division  applied  only  to  the 
shops.  It  has  since  been  extended  to  include  the  office 
force  as  well.  The  Ford  branches  and  assembly  plants 
are  on  the  same  basis;  and  in  both  the  Ford  Canadian 


RECORD  OF  INVESTIGATION 

lw,t™,,         t- 24-15 
..-.    2-5-1* 

4-4- 13  vui.,.   98  W.  WBM  A 

jl!,,.!,,,^  Y«r«      ;,t.s      5  I«»r» 


County  <   Ho»«  Sa 


12698  $500.  u.in 

J«iN..  8892Z         B.:.,,.    140.       l«»»    Hied. 


^4  report  sheet  like  this  is  made  out  for  each  employee  in  the  Ford 

plant,     hi  order  to  share  in  the  profits,  employees  must  receive 

a  "dean  bill  of  health"  from  the  investigators  on  the  various  points 

shown  above 


Here  is  a  typical  row  of  Ford  workmen's  houses  before  any  thought 

had  been  given  to  making  the  home  life  of  employees  more  pleasant. 

Note  the  contrast  between  this  picture  and  the  one  below 


Pared  streets,  cheerful  homes,  and  pleasant  surroundings  generally 

follow  in  the  wake  of  the  investigators  irfio  study  limny  conditions 

and  suggest  improvements  to  Ford  employees 


GIVING  THE   MEN   A   BIGGER  CHANCE      177 

and  English  plants  similar  plans  have  been  put  into 
effect,  although  the  minimum  is  lower  there,  owing  to 
the  difference  in  the  American  and  British  wage  scales. 
Women  in  the  factory  who  are  breadwinners — and  there 
are  several  hundred — are  treated  precisely  as  men. 

"Women  as  a  class,  however,  are  not  profit  sharers. 
Instead,  the  company  gave  them  a  substantial  increase 
in  wages.  The  minimum  now  for  a  girl  in  the  office  is 
$65  a  month.  In  explaining  this  difference  in  the  treat- 
ment of  men  and  women,  an  official  of  the  company 
said :  ' '  Women  do  not  share  because  they  are  not,  as  a 
rule,  heads  of  families.  Also  women,  as  a  rule,  are  likely 
to  throw  up  their  positions  at  any  time,  without  notice, 
for  any  reason  that  may  happen  to  influence  them,  even 
temporarily.  Few  of  them  remain  long  with  the  com- 
pany. Those  who  do  remain  several  years,  and  come 
to  be  looked  upon  as  reliable,  steady  employees,  not 
infrequently  make  sudden  announcements  of  their  mar- 
riages and  leave.  For  this  reason  they  are  not  con- 
sidered such  stable  economic  factors  as  men.  An 
advance  in  pay  is  considered  more  appropriate  for 
them." 

For  the  employee  who  is  22  years  of  age,  and  who  has 
been  on  the  payroll  six  months  or  longer,  the  sole  dis- 
barment condition  is  persistence  in  habits  of  life  which 
fall  short  of  the  standard  the  Ford  Motor  Company 
believes  essential  in  a  decent,  self-respecting  American 
workman.  While  what  a  man  is  on  the  outside  is 
reflected  to  a  greater  or  less  extent  in  his  demeanor  and 
the  quality  of  his  workmanship,  the  only  practical  way 
in  which  the  company  could  check  up  in  this  respect 
was  by  personal  visits  to  the  homes.  In  a  large  measure 
the  results  attained  by  this  organization  is  traceable  to 
these  visits. 


178 HELPING   LOYALTY   HELP   YOU 

So  without  pausing  to  debate  the  fine-spun,  theoretical 
aspects  of  the  act,  as  to  whether  an  extension  of  super- 
vision over  the  private  life  of  their  workers  was  unwar- 
rantably paternalistic  or  not,  the  Ford  Motor  Company 
instituted  a  follow-up  or  "investigation"  department 
and  set  about  the  huge  task  of  visiting  the  homes  of 
every  one  of  its  seventeen  thousand  and  more  employees. 

The  efforts  of  the  Ford  organization  in  this  respect 
have  borne  remarkable  fruit.  It  is,  in  my  opinion,  most 
practicable  and  effective  social  welfare  work.  It  is 
espionage  in  a  way,  but  of  a  totally  different  sort  than 
ordinarily  implied  by  this  term.  Ford  exercises  the 
closest  supervision  over  the  home  life  and  financial 
affairs  of  his  workmen.  He  does  it,  however,  openly  and 
frankly  and  for  the  purpose,  not  of  taking  something 
away  from  them  or  persecuting  them,  but  in  order  to 
help  them  in  the  most  practical  way  one  man  can  help 
another :  namely,  by  bettering  his  financial  condition 
and  then  teaching  him  how  to  use  prosperity  to 
advantage. 

MORE  about  the  methods  used  to  keep  a  close  check  on 
the  home  lives  of  Ford  workers.     How  they  are  kept 
out  of  debt. 

Much  of  the  success  of  the  plan  has  depended  on  the 
type  of  men  Ford  chose  for  his  investigators.  Men's 
private  affairs  had  to  be  pried  into,  facts  secured  which 
in  many  cases  required  a  high  order  of  detective  ability, 
and  they  had  to  be  obtained  quickly.  Persistence,  a 
deal  of  shrewdness,  and  an  infinite  amount  of  tact  thus 
were  requisite  qualities  in  order  to  get  results  with  a 
minimum  of  antagonism.  Men,  the  slaves  of  all  manner 
of  bad  habits,  the  victims  of  new-world  vices  and  old- 
world  standards  of  living,  had  to  be  made  to  see  the 


GIVING   THE   MEN   A   BIGGER   CHANCE      179 

worth-white  side  of  manly  attributes  and  decent,  clean 
home  conditions. 

Definite,  measurable  results  are  plentiful.  Of  the 
many  families  reunited;  the  drug  and  liquor  addicts 
reformed;  the  criminally  inclined  who  have  been  re- 
claimed; the  debt-burdened  families  relieved;  of  the 
hundreds  of  children  clothed  and  fed  decently  for  per- 
haps the  first  time;  the  thousands  of  homes  cleaned  up 
and  made  livable;  of  the  eleven  or  twelve  thousand 
families  that  have  been  moved  from  the  slums  and  unde- 
sirable, congested  locations  to  outlying  suburbs  and 
country  districts,  most  of  them  into  nice  little  cottages 
of  their  own;  of  the  tremendous  increase  in  savings 
deposits,  insurance  carried,  and  payments  on  land  and 
home  contracts — of  these  and  other  concrete  results  of 
the  Ford  efforts  in  behalf  of  their  workers,  it  would  be 
possible  to  write  in  great  detail.  Perhaps  the  most  strik- 
ing evidence,  however,  is  the  way  in  which  the  investi- 
gators are  received  in  the  homes. 

Henry  Ford  has  been  extremely  interested  in  the 
foreign-born  workmen,  of  whom  there  are  some  52 
nationalities  comprising  in  number  more  than  half  his 
force.  He  feels  he  must  shoulder  his  part  of  the  burden 
of  making  them  feel  at  home  here,  and  of  preparing 
them  for  speedy  assimilation  into  our  national  life. 

The  very  fact,  however,  that  so  many  of  the  Ford 
employees  were  foreign  born  and  non-English  speaking, 
greatly  complicated — at  the  start — the  administration  of 
the  profit-sharing  plan,  and  particularly  the  labor  of  the 
investigators.  It  was  difficult  in  the  first  place  to  get 
them  to  understand  the  conditions.  Many  were  the 
curious  and  incorrect  impressions  which  it  took  a  long 
time  to  eradicate.  One  idea,  for  instance,  was  that  all 
a  man  had  to  do  to  qualify  for  a  share  in  the  profits 


180 HELPING   LOYALTY   HELP   YOU 

was  to  get  married.  Immediately,  men  who  were  wife- 
less took  steps  to  remedy  the  deficiency,  fairly  or  other- 
wise. Some  hastily  married,  others  persuaded  or  hired 
women  friends  or  relatives  to  act  as  their  wives,  still 
others  faked  marriage  certificates,  asserting  their  wives 
were  on  the  other  side  of  the  water.  All  these  tangles 
had  to  be  patiently  straightened  out,  the  men  made  to 
see  the  error  of  misrepresenting  the  facts  and  the  unwis- 
dom of  precipitous  matrimony. 

Another  impression  was  to  the  effect  that  if  a  man 
owned  real  estate  he  would  get  the  profits,  and  for  a 
time  some  real  estate  men  reaped  a  harvest.  By  a 
singular  coincidence,  one  man  bought  real  estate  on 
such  an  assurance  and  the  very  next  day  he  went  on  the 
profit  payroll.  The  news,  of  course,  spread  rapidly.  As 
a  result  that  particular  real  estate  man  signed  up  many 
advantageous  contracts  the  next  few  days.  Then  the 
Ford  officials  got  wind  of  the  affair  and  through  the 
legal  department  forced  the  real  estate  man  to  release 
every  Ford  employee  unfairly  inveigled  into  contracts. 

This  and  similar  experiences  led  the  company  to 
undertake  supervision  of  the  men's  legal  affairs.  A 
representative  of  the  legal  department  now  makes  his 
headquarters  in  the  employment  department  and  the 
men  are  strongly  urged,  before  entering  into  any  real 
estate  deals,  to  confer  with  him. 

Other  special  purchases  are  supervised  similarly. 
Many  of  the  men  were  found  to  be  debt  ridden  with 
instalment  purchases.  So  the  company  frankly  took 
up  the  matter  with  the  various  suppliers  of  household 
luxuries  and  got  them  to  agree  not  to  sign  up  a  con- 
tract with  a  Ford  employee  until  they  had  first  con- 
ferred with  the  company  and  ascertained  his  ability  to 
make  good  on  his  payments.  The  evil  of  garnishees 


GIVING   THE   MEN   A   BIGGER   CHANCE      181 

has  been  almost  eliminated  by  similar  cooperation 
between  local  merchants  and  the  company.  Before 
instituting  legal  proceedings  the  merchants  are  urged 
to  take  up  the  matter  with  the  Ford  officials,  who 
usually  are  able  to  make  some  arrangement  for  the 
resumption  of  payments.  To  rid  themselves  as  promptly 
as  possible  of  all  indebtedness,  and  to  guard  against 
becoming  reincumbered  is  one  of  the  lessons  which  the 
company,  through  its  sociological  department,  endeavors 
constantly  to  hammer  home  to  the  workmen. 

In  passing,  it  should  be  mentioned  that  many  of 
the  little  plans  devised  by  the  men  to  make  themselves 
appear  qualified  for  promotion  when  they  really  are 
not,  such  as  the  falsification  of  marriage  certificates, 
succeeded  temporarily.  In  practically  every  case,  how- 
ever, the  Ford  investigators  eventually  penetrated  these 
deceits.  The  company  did  not  discharge  the  men  so 
caught.  If  they  did  not  voluntarily  leave  they  were 
given  a  wholesome  talking  to  about  the  need  for  truth 
telling  on  all  occasions,  and  the  lesson  was  made  con- 
crete by  compelling  them  to  pay  back  every  penny 
falsely  obtained.  If  a  man  refused  to  stay  and  pay  the 
company  took  the  matter  to  court  and  invariably  secured 
the  decision. 

HOW  foreign-born    workers   are    handled  by   Ford. 
Educational  features  that  pay  big  dividends.     A 
comparison  of  results  achieved  by  the  old  and  new  plans. 

The  large  proportion  of  non-English  speaking  em- 
ployees greatly  hampered  the  investigators,  for  it 
required  them  to  work  through  interpreters.  Men  com- 
petent to  act  as  interpreters  were  hard  to  find. 

The  difficulties  with  men  who  could  not  speak,  read 
nor  write  English,  however,  soon  led  the  company  to 


182 HELPING  LOYALTY   HELP   YOU 

organize  for  instruction  in  English.  An  experienced 
educator  was  called  in.  Under  his  energetic  leadership, 
with  a  teaching  staff  of  volunteers  drawn  mostly  from 
the  ranks  of  foremen,  a  class  of  over  a  thousand  was 
graduated  at  the  end  of  37  weeks.  At  the  present  time 
approximately  sixteen  hundred  men  are  receiving 
instruction.  Two  lessons  a  week  are  given.  Attendance 
is  compulsory  for  those  who  have  registered. 

Within  a  very  short  time  after  the  inauguration  of 
the  plan  there  was  .a  voluntary  increase  of  from  fifteen 
to  twenty  per  cent,  in  spite  of  the  fact  that  each  man 
worked  one  hour  less.  On  the  fourth  of  February,  1913, 
with  16,000  men  working  ten  hours  a  day,  the  company 
made  and  shipped  16,000  units  of  its  product.  The 
same  month,  one  year  later,  after  the  new  plan  had 
been  in  effect  a  little  over  a  month,  with  15,800  men 
working  eight  hours  a  day,  it  made  and  shipped  26,000 
units.  At  the  present  time,  with  approximately  18,000 
workers,  it  is  producing  at  a  rate  of  over  40,000  units 
a  month. 

Some  of  this  gain,  it  is  true,  has  come  about  through 
improved  methods,  but  much  of  it  has  been  due  to  the 
increased  interest,  loyalty,  and  efficiency  of  the  force. 
Working  less  hours  a  day,  the  men  are  able  to  sustain 
a  higher  rate  of  output  each  hour.  Reasonably  certain 
of  the  permanency  of  their  employment  and  happy  in 
the  knowledge  that  they  are  gaining  on  the  rising  cost 
of  living,  they  are  rid  of  fear  and  worry. 


|."i  VERY  business  needs  to  develop  the  personality  of  its 
f-J  men,  for  that  means  individualism,  originality,  growth, 
and  progress.  GEORGE  H.  BARBOUR, 

President  of  the  Michigan  Stove  Company 


XVIII 

HELPING  EMPLOYEES 
TO  SAVE 

By  Stanley  A.  Dennis 
Based  on  an  Extensive  Investigation 

WHAT  is  the  best  way  for  an  employer  to  go  about 
establishing  a  cooperative  savings  and  loan  asso- 
ciation among  his  workers?  If  he  is  to  profit  by  the 
experience  of  many  companies,  he  will  recognize  first 
of  all  that  certain  principles  underlie  a  successful  asso- 
ciation. 

These  principles  have  been  widely  recognized  in 
recent  betterment  work.  They  have  been  well  stated 
by  Dr.  Edward  E.  Pratt,  chief  of  the  Bureau  of  Foreign 
and  Domestic  Commerce.  He  says:  "These  principles 
are:  (1)  that  a  man's  best  security  is  his  fellow  work- 
men's estimate  of  him;  (2)  that  to  provide  facilities 
merely  for  borrowing  money  may  encourage  improvi- 
dence and  that  any  real  solution  of  the  problem  must 
encourage  thrift  instead;  (3)  that  an  organization 
among  workers  will  be  self -advertising ;  (4)  that  the 
workers  themselves  are  most  capable  of  meeting  prop- 
erly the  needs  of  their  fellows." 

Successful  associations  are  maintained,  among  others, 
in  the  following  companies:  The  New  York  Edison 
Company;  The  William  Filene's  Sons  Company  of 
Boston ;  The  Ford  Motor  Company  of  Detroit ;  The  Cel- 
luloid Company  of  Newark;  The  Northern  Trust  Com- 


184 HELPING  LOYALTY   HELP   YOU 

pany  of  Chicago;  The  Chicago  Tribune;  Sprague 
Warner  and  Company  of  Chicago;  Carson,  Pirie,  Scott 
and  Company  of  Chicago;  The  Curtis  Publishing  Com- 
pany of  Philadelphia ;  The  Larkin  Company  of  Buffalo ; 
The  Joseph  and  Feiss  Company  of  Cleveland;  and  The 
Gorham  Manufacturing  Company  of  Providence.  Many 
others  could  be  named. 

These  associations  are  for  both  saving  and  lending 
money.  Several  well-known  companies  for  one  reason 
or  another  maintain  savings  associations  only.  Certain 
details  of  organization  are,  of  course,  similar  in  all  of 
the  associations.  While  the  ends  obtained  are  almost 
identical,  the  means  will  be  found  to  vary  in  as  many 
different  ways  as  there  are  different  conditions  to  be 
faced. 

A  CONCRETE   plan  for   organizing  a  cooperative 
savings  and  loan  association,  with  every  employee 
as  a  member.     Why  control  should  rest  with  the  workers. 

When  you  have  gone  through  your  list  of  problems 
and  conditions  and  analyzed  each,  either  alone  or  with 
the  assistance  of  a  few  picked  men,  appoint  "a  com- 
mittee to  assist  in  founding  a  cooperative  savings  and 
loan  association"  with  every  member  an  employee.  If 
your  company  maintains  a  service  or  welfare  depart- 
ment, or  a  club  for  the  advancement  of  the  employees' 
interests,  let  the  club  appoint  this  committee.  In  con- 
ference with  this  committee,  look  at  the  whole  problem 
from  the  point  of  view  of  the  worker.  Get  his  approach, 
his  "angle,"  his  ideas  and  suggestions. 

Combine  the  results  of  your  preliminary  study  with 
the  new  ideas  and  proposed  methods  obtained  in  con- 
ference with  the  workers.  Make  up  a  tentative  com- 
mittee report  which  will  include  a  set  of  by-laws,  if 


HELPING   WORKERS   SAVE 185 

the  association  is  to  be  a  part  of  a  larger  employees' 
club,  or  a  constitution,  if  no  organization  exists.  Run 
off  mimeographed  copies  of  the  tentative  report.  See 
that  a  copy  goes  into  the  hands  of  every  employee.  Ask 
for  criticism  and  suggestions.  Give  him  a  week  to  think 
about  them.  Give  him  a  loosely  drawn  up  ''ballot"  to 
fill  in  and  extend.  Let  him  drop  this  in  a  conveniently 
placed  box. 

When  suggestions  come  in,  they  can,  if  thought  advis- 
able, be  worked  into  the  final  report  of  the  organization 
committee.  In  this  way  every  employee  gets  a  voice  in 
organizing  the  association.  It  represents  his  work,  his 
thought,  his  time.  It  wins  his  interest  at  the  start  and  is 
likely  to  win  his  loyalty  more  quickly  than  if  he  first 
saw  the  plan  of  organization  in  final  form.  Best  of  all, 
this  kind  of  cooperation  puts  into  motion  a  self -advertis- 
ing campaign  among  the  employees  themselves. 

The  final  step  is  the  adoption  of  the  revised  report  by 
the  employees,  and  the  election  of  officers  as  provided 
in  the  by-laws  or  constitution.  When  this  is  done,  direct 
control  of  the  association  passes  into  the  hands  of  the 
employees  themselves. 

These  steps  that  have  just  been  discussed  form,  in  a 
general  way,  the  plan  usually  most  successfully  followed 
when  establishing  an  association.  Looking  more  closely 
now,  in  the  organization  scheme,  into  the  actual  making 
of  the  by-laws  or  constitution,  certain  questions  demand 
special  attention. 

Perhaps  the  most  important  problem  is  the  question 
of  limitations  as  to  membership,  deposits  and  loans. 

In  many  associations,  deposits  are  annually  limited 
to  a  certain  sum.  In  others,  only  a  certain  annual 
deposit  can  share  in  any  distribution  of  profits,  but  any 
excess  may  be  carried  in  the  fund. 


186 


HELPING  LOYALTY   HELP  YOU 


In  regard  to  deposits,  there  is  a  wide  range  of  prac- 
tice. In  the  simplest  form  the  employee  agrees  to  "pur- 
chase," say,  ten  shares  at  a  par  value  of  twelve  dollars 
each.  This  would  make  his  annual  savings  $120  payable 
in  weekly,  semimonthly  or  monthly  instalments. 

Local  conditions  must  govern  the  size  of  a  share  and 
the  number  "purchasable."  The  maximum  participa- 
ting annual  deposit  should  be  within  reach  of  the  lowest- 
paid  employee,  if  possible,  or  at  least  held  down  so  that 
high-salaried  employees  may  not  take  the  larger  share  of 
the  profits. 


FORM  I:     This  card  serves  members  of  The  Celluloid  Company's  savings 

association  as  a  pass  book.     A  record  is  made  of  both  fines  and  deposits. 

Deposits  for  six  months  can  be  quickly  deducted.     The  deposit  dates  are 

printed  on  the  card 

Non  participating  excess  deposits  serve  the  purposes 
of  the  man  who  wants  to  save  a  larger  sum,  and  at  the 
same  time  patronize  the  association.  The  New  York 


HELPING   WORKERS   SAVE 187 

Edison  Company's  association  provides  for  what  are 
called  instalment  shares,  savings  shares,  juvenile  savings 
shares,  accumulative  prepaid  shares,  and  income  shares. 
Each  kind  has  its  particular  purposes  and  advantages. 
Shares  differ  greatly  in  size  and  number  per  employee. 
Usually  a  maximum  number  that  can  be  subscribed  is 
set,  sometimes  a  minimum,  and  sometimes  no  limits  are 
fixed. 

In  the  successful  association  of  The  Celluloid  Com- 
pany, deposits  of  twenty-five  cents  or  more  weekly — no 
limit — are  accepted.  A  fine  is  imposed  for  failure  to 
deposit  as  agreed. 

DETAILS    of    successful    "banking"  conducted  by 
many  firms  for   employees.     How   thrift  is  en- 
couraged and  workers  kept  out  of  minor  financial  troubles. 

Periods  of  savings  are  of  six  months  duration  and 
are  known  as  " series."  Profits  are  distributed  only  on 
savings  of  one  dollar  or  less  weekly.  The  savings  branch 
is  successful  largely  because  an  employee  can  deposit 
his  money  in  convenient  boxes  on  pay  day.  Automatic 
collection  from  the  payroll,  at  the  request  of  the 
employee,  is  also  followed  in  many  cases. 

In  the  Joseph  and  Feiss  Company  the  head  of  the 
service  department  induces  parents  to  permit  their  chil- 
dren to  retain  a  fair  share  of  their  earnings  and  to 
deposit  them  in  the  "Clothcraft  Penny  Bank."  This 
bank  has  proved  an  invaluable  aid  in  building  up  the 
effectiveness  of  the  workers,  most  of  whom  are  young 
women.  The  shares  are  of  sufficient  value  in  some  cases 
to  assist  the  depositors  in  building  and  paying  for  their 
own  dwellings. 

In  regard  to  withdrawals,  the  practice  is  to  exact 
a  small  fee  when  funds  are  withdrawn  on  any  date 


188 


HELPING  LOYALTY   HELP   YOU 


APPLICATION  FOR  LOAN 

Savings  and  Loan  Association 

of  the  Employees  of  the 

Chicago  &  North  Western  Ry.  Co. 

General  Offices 


Chicago. 


I  hereby  make  application  for  a  loan  In  the  amount  of  $. 
for^ days,  due . 


Account  Na. 

Dcpsrtmsnt- 
Salary  J 


376- 


/JO.  oo 


.  Amount  paid  In  % 


•  6~O 


Previous  loan  this  month. 
My  residence  address  is_ 


4*/  3  6 


I  hereby  declare  my  Intention  of  remaining  in  the  employ  of  the  Chicago  ft  North  Western  Ry  Co. 
Should  I  sever  my  connection  with  the  said  company.  I  will  give  Immediate  notice  before  so  doing 

to  the  secretary  of  the  above  named  association. 
It  Is  distinctly  understood  that  loans  will  be  made  only  to  the  amount  of  $15.00,  plus  the  amount 

of  said  applicant's  deposit  In  shares  with  association,  upon  approval  of  Secretary. 
Loans  la  excess  of  the  amounts  as  fUedby  the  above  rule  can-be  had  only  in  emergency  cases.satlsfae 

torfly  explained  to  the  Executive  Commlttee.and  only  on  security  approved  by  the  said  committee. 
Name  ~~ 


Approved 


*7 


Executive 
Committee 


Chicago. 


GsU^tSs 

0 


To  the  Treasurer  of  the 

Chicago  &  North  Western  Ry.  Co. 

For  value  received,  I  hereby  assign  to  the  Savings  and  Loan  Association  of  the  Employees,  the  earn 
of  $      /6~CO  ,  and  I  hereby  authorize,  order  and  direct  you  to  deduct  said 

amount  from  any  money  due  me  on  the  pay  rolls  for  the  month  of    ^£M^^-~       191  f 
and  pay  to  the  Treasurer  of  the  Savings  and  Loan  Association  of  the  Employees 


Approved 


FORM  II:     Frequently  the  routine  work  of  association  w  handled  by  an 
employee  during  spare  moments.     It  is  important  to  make  the  task   a« 
simple  aa  possible.     This  loan  application  devised  by  the  Chicago  <&  North- 
western Railway  Company  meets  the  need  of  simplicity  admirably 


HELPING   WORKERS   SAVE 180 

except  on  a  set  date.  No  charge  is  made  when  deposits 
are  taken  out  to  pay  off  a  loan  or  when  illness  or  a  "lay 
off"  is  the  cause. 

In  the  Filene  association,  deposits  in  any  sum,  from 
five  cents  upwards,  are  received.  The  depositor  is  not 
required  to  leave  his  money  on  deposit  for  a  given  length 
of  time,  but  he  agrees  not  to  withdraw  it  until  it  reaches 
a  stated  amount.  Partial  withdrawals  are  not  permitted, 
as  this  would  necessitate  a  check  system. 

Loans  are  now  made  quite  generally  "on  character." 
This  conforms  with  the  first  principle  laid  down  pre- 
viously. Mr.  S.  T.  Simmonds,  manager  of  The  Cellu- 
loid Club,  says:  "The  complete  failure  of  any  scheme 
whereby  money  was  to  be  loaned  on  character  and  unse- 
cured was  freely  predicted.  All  business  men  consulted 
thought  it  would  fail.  These  gentlemen  now  confess  to 
being  most  agreeably  disappointed." 

Other  associations  lend  up  to  a  certain  limit  on  no 
security.  An  application  for  a  loan  often  takes  the 
form  of  a  promissory  note. 

Unsecured  loans  vary  in  size  much  as  the  shares  do. 
On  this  point,  Mr.  Simmonds  says:  "An  employee's 
record  as  an  employee  is  mainly  what  determines 
whether  the  loan  is  granted  or  not.  In  the  Celluloid 
association,  depositors  may  borrow  in  sums  of  from  one 
dollar  to  two  hundred  dollars.  The  amount  of  deposit 
bears  no  relation  to  the  sum  that  may  be  borrowed, 
except  that  no  loan  of  more  than  ten  dollars  in  excess 
of  a  deposit  will  be  granted  to  a  minor  without  the 
written  consent  of  parent  or  guardian.  For  sums  above 
twenty-five  dollars  endorsement  is  asked." 

No  interest  is  asked  on  loans  in  some  organizations. 
In  others,  interest  charges  run  from  one-half  of  one 
per  cent  per  month,  or  six  per  cent  per  annum,  to  one 


190 HELPING  LOYALTY   HELP   YOU 

per  cent  per  week,  or  fifty-two  per  cent  per  annum. 
Other  associations  have  a  set  scale  of  charges,  as,  for 
example,  15  cents  on  $2.50  for  two  weeks  or  less;  20 
cents  on  $5.00  for  the  same  period;  25  cents  on  $7.50, 
and  so  on. 

Repayment  may  be  provided  -for  on  a  set  date  as  in 
the  case  of  a  note,  or  by  weekly  or  semi-monthly  or 
monthly  instalments.  Failure  to  pay  as  agreed  often 
prevents  a  second  loan.  Profits  are  obtained  from 
charges  for  loans,  withdrawal  fees,  income  on  invest- 
ments, and  fines.  In  some  cases  the  company  borrows 
the  balance  above  outstanding  loans  and  pays  a  stated 
rate  of  interest.  Where  profits  are  derived  from  the 
four  sources  just  named,  associations  frequently  pay 
dividends  at  the  end  of  the  " series,"  or  year,  equal  to- 
ten  per  cent  or  more  of  the  deposits. 

Expenses,  of  course,  are  deducted  before  the  profits 
are  distributed.  To  encourage  thrift  some  profit  is  neces- 
sary, but  it  is  naturally  not  considered  good  policy  to 
encourage  borrowing  in  order  to  increase  the  profits! 
All  investments  of  deposits  are  ordinarily  handled  by  a 
board  of  directors.  The  usual  officers  are  a  president, 
vice-president,  secretary,  and  treasurer. 

Turning  now  to  the  general  aspects  of  the  question, 
perhaps  it  is  not  too  much  to  say  that  hundreds  of  busi- 
ness concerns  have  tried  to  find  some  practical  method 
of  helping  employees  financially,  and  for  encouraging 
thrift  among  them.  Numerous  philanthropic  societies 
have  given  their  assistance.  Several  states  have  by 
restrictive  legislation,  and  a  feAV  by  constructive  legisla- 
tion, aimed  to  meet  the  needs  of  the  small  borrower  and 
end  the  abuses  often  perpetrated  by  petty  money 
lenders. 

The  remedies  offered  range  from  Christmas  savings 


HELPING   WORKERS   SAVE 191 

clubs  to  co-partnerships  for  employees.  Profit-sharing, 
pension  plans,  and  sick  and  death  benefits  each  serve 
a  special  purpose  in  industrial  betterment  work,  but 
they  are  not  intended  primarily  to  promote  thrift  and 
assist  unfortunate  workers  in  their  petty  financial  needs 
day  in  and  day  out. 


APPLICATION    FOR    LOAN. 

J? 
<?' 


MUST    deposit   weekly,   the 


FORM  III:     This  is  the  loan  application  form  used  6z/  The  Celluloid 

Company's  association.     It  is  a  rule  with  this  association  that  payments 

towards  discharging  loans  be  made  weekly,  in  order  that  borrowers  may 

get  out  of  debt  as  quickly  as  possible 

Private  and  state  attempts  to  solve  these  difficulties 
have  resulted  in  the  organization  of  such  bodies  as  the 
Workingmen  's  Loan  Association  of  Boston,  the  Provi- 
dent Loan  Society  of  New  York,  and  the  First  State 
Pawners'  Society  of  Chicago.  These  organizations  keep 
their  charges  small  and  equitable  and  are  devised  so  as 
not  to  take  advantage  of  an  unfortunate  borrower. 

One  serious  objection  to  these  organizations  is,  pos- 
sibly, that  only  he  who  has  security  to  offer  may  borrow. 
The  Boston  association  loans  on  chattels  and  the  New 
York  and  Chicago  societies  on  pawns.  Also,  they  solve 
only  the  borrowing  half  of  the  worker's  problem,  not  the 


192 HELPING   LOYALTY   HELP  YOU 

savings  half.  Another  objection  is  that  the  worker  is 
only  a  patron  and  not  a  partner  in  the  business. 

Likewise,  the  practice  of  reputable  business  concerns 
in  lending  to  deserving  employees  on  ample  security  is 
perhaps  open  to  objections.  This  plan  does  not  help  the 
man  who  has  no  security  to  offer  and  it  does  not  create 
thrift  and  build  up  savings  accounts  among  the  entire 
force. 

Of  deep  significance  is  the  fact  that  where  the  state 
and  the  philanthropist  have  evidently  failed  in  a  large 
measure,  the  employee  himself  has  succeeded.  The 
survey  of  fourteen  widely  known  industrial  organiza- 
tions— the  betterment  activities  of  which  cover  140  years 
of  experience — that  underlies  this  chapter  indicates  that 
the  plan  already  discussed,  a  cooperative  savings  and 
loan  association,  is  probably  the  best  means  of  keeping 
the  worker  out  of  minor  financial  troubles. 


/^1 RADUALLY  encouraging  men  to  undertake  more  and 
*J  more  difficult  work,  leaving  them  to  work  out  the  diffi- 
culties, but  at  the  same  time  directing  and  guiding  them  in  a 
way  not  too  helpful,  is  good  and  beneficial.  Helping  in  the 
wrong  way,  that  is  to  the  extent  of  practically  doing  the  task 
or  the  man,  only  weakens  him,  and  instead  of  his  being 
strengthened  and  benefited  by  the  discipline  and  exertion  of 
overcoming  the  obstacle  in  his  path,  he  is  actually  left  by  your 
ill-advised  help  a  weaker  and  less  able  member  of  the  organi- 
zation. E.  M.  HERB, 

President,  Westinghouse  Electric  and  Manufacturing  Company 


XIX 

YOUR  RIGHT  IN  YOUR 
EMPLOYEE'S  INVENTIONS 


By.  Joseph  W.  Hays, 
Combustion  Engineer 


WHEN  an  employee  of  mine  makes  an  invention, 
what  rights  have  I  in  that  invention?  This  is 
a  question  the  answer  to  which  every  manufacturer 
needs  to  know,  for  large  interests  may  depend  on  it. 

Consider  the  case  of  a  certain  New  England  factory. 
At  a  cost  of  thousands  of  dollars  this  concern  acquired 
the  patents  covering  an  automatic  machine.  At  a  still 
heavier  expense  the  factory  was  equipped  throughout 
with  these  machines.  The  concern  rapidly  put  itself  in 
the  way  of  obtaining  a  monopoly  in  its  particular  line 
of  manufacture. 

Competitors  were  in  despair.  The  new  machine  so 
reduced  the  cost  of  manufacture  that  in  order  to  stay 
in  the  field  at  all  they  figured  they  would  have  to  do 
business  below  cost.  It  requires  a  lot  of  sand,  sentiment 
and  dollars  to  do  business  in  that  way. 

The  factory  with  the  new  machine  felt  very  secure 
in  its  position.  Its  patents  were  considered  unassail- 
able. Mechanical  experts  had  passed  upon  the  machine 
and  pronounced  it  almost  perfect.  None  could  think 
of  any  way  in  which  the  machine  could  be  improved 
or  paralleled. 

But  ingenuity,  as  the  event  proved,  found  a  method 


1£4 HELPING   LOYALTY   HELP  YOU 

of  defeating  the  purposes  of  even  this  highly-developed 
machine.  The  concern  had  in  its  employ  an  expert 
mechanic  whose  duty  it  was  to  keep  the  automatic 
machines  in  order. 

He  was  a  man  who  always  kept  his  eyes  open  and  his 
wits  in  working  order.  He  combined — in  addition  to 
having  the  knowledge  necessary  to  the  working  of  his 
craft — the  initiative  and  ingenuity  of  the  inventor.  It 
can  easily  be  supposed  that  every  factory  is  liable  to 
have  men  of  this  type  on  its  payroll.  The  wise  employer 
cultivates  them. 

Now  this  particular  mechanic  also  combined  common 
sense  with  his  inventive  faculty.  He  reasoned  as  fol- 
lows: this  automatic  machine  exists  for  the  sake  of  its 
product.  The  product  is  therefore  of  more  importance 
than  the  machine.  I  see  no  way  in  which  the  machine 
can  be  improved.  Can  I  improve  the  product?  He  set 
to  work  and  did  improve  the  product,  which  was,  and 
still  is,  something  in  common  use  by  all  classes  of  people. 
He  found  the  weak  points  of  the  article  and  by  a  slight 
change  in  construction  eliminated  them.  He  added  three 
new  features  which  gave  the  improved  device  instant 
popularity  when  it  was  finally  introduced. 

Without  changing  the  functions  of  the  article,  he  so 
changed  the  article  itself  in  working  out  the  improve- 
ments that  the  automatic  machines  in  his  charge  could 
not  make  it.  Neither  could  they  by  any  modification  of 
design,  or  the  addition  of  any  attachments,  be  made  to 
produce  it.  The  improved  device  called  for  an  entirely 
different  automatic  machine. 

As  is  the  case  with  most  real  improvements,  the  new 
article  was  much  simpler  than  the  old  one.  The  inventor 
designed  also  an  automatic  machine  to  make  it,  and  this 
in  its  turn  was  relatively  simple  and  inexpensive.  He 


YOUR  EMPLOYEE'S   INVENTIONS  195 

estimated  that  the  factory  cost  of  the  new  article  would 
be  just  a  little  more  than  half  that  of  the  old  one. 
Unlike  most  preliminary  estimates  of  this  kind,  his 
figures  were  more  than  realized. 

The  man  was  more  than  a  good  inventor.  He  was 
blessed  with  a  business  instinct  that  taught  him  how 
to  look  out  for  himself.  He  applied  for  patents  both 
upon  the  article  itself  and  his  machine  for  making  it. 
Then  he  held  the  fate  of  his  employers'  business  in  his 
hands. 

WHY  it  is  to  the  interest  of  the  employer  to  secure 
the  ownership  on  a  fair  basis  of  valuable  inven- 
tions by  his  employee  and  how  he  may  do  this  legally. 

Now,  this  mechanic  may  or  may  not  have  been  morally 
bound  to  give  his  employers  a  chance  to  purchase  his 
inventions.  The  opportunity  of  invention  came  as  an 
incident  to  his  employment.  The  ideas  came  to  him 
through  observation  of  his  employers'  products  and 
machines,  and  during  the  hours  when  all  of  his  thought 
and  energy  belonged  to  his  employers.  But,  as  a  matter 
of  fact,  he  did  not  offer  the  patents  to  his  employers. 

He  went  to  their  chief  competitor  instead.  This  was 
a  good  business  move  for  him.  All  the  competitors  were 
in  deep  water,  and  he  felt  that  his  best  chances  lay  with 
the  strongest  among  them.  He  made  his  own  terms; 
and  in  less  than  two  years  his  old  employers  were  forced 
to  sell  out,  at  a  great  loss,  to  the  firm  that  had  bought 
his  patents. 

It  is  to  the  interest  of  any  manufacturer,  therefore, 
to  secure  the  exclusive  ownership  of  valuable  patents 
that  are  taken  out  by  his  employees  and  are  in  the  least 
connected  with  his  line.  A  liberal  policy  of  remunera- 
tion not  only  stimulates  invention,  but  it  also  encourages 


196 HELPING   LOYALTY   HELP   YOU 

the  inventor  to  put  the  results  of  his  skill  at  the  dis- 
posal of  his  employers.  A  contract  can  be  drawn  up 
with  each  employee,  by  which  he  agrees  to  assign  all 
inventions  which  he  may  make  during  the  term  of  his 
employment. 

"But  an  agreement  of  this  character  must  be  une- 
quivocal, and  can  not  be  implied  from  a  general  bargain 
for  his  time  and  skill  and  labor,  nor  is  it  proved  con- 
clusively by  the  fact  that  the  experiments  resulting  in 
the  invention  were  made  at  the  request  and  expense  of 
the  employers.  .  .  .  An  agreement  of  this  nature 
relates  only  to  the  period  of  service,  and  inventions 
made  prior  to  that  period  or  after  its  expiration  belong 
to  the  employee  and  are  patentable  by  him  alone." 
(Robinson  on  Patents,  I,  584.) 

A  contract  of  this  sort  is  not  the  same  as  an  assign- 
ment, though  it  is  valid  as  a  contract  and  can  be  legally 
enforced.  Every  employee  who  is  in  a  position  to  invent 
anything — either  machine  or  product — is  required  in 
certain  concerns  to  sign  such  a  paper  on  entering  the 
concern's  employ. 

In  the  absence  of  a  contract,  an  employer  may  -find 
himself  in  the  same  position  as  the  owner  of  the  auto- 
matic machine  mentioned  above.  The  courts  take  care 
to  protect  the  actual  inventor. 

The  act  of  invention  does  not  consist  in  the  actual 
working  out  of  the  conception  of  a  method  for  doing 
a  thing,  but  it  does  consist  in  the  conception  itself. 
Therefore,  if  an  employer  has  an  idea  for  an  invention, 
he  can  safely  employ  a  mechanic  to  work  out  the  details 
and  perfect  the  invention,  simply  suggesting  to  him  the 
principal  working  parts  of  the  apparatus  and  the  rela- 
tions of  these  parts  to  each  other.  In  the  eyes  of  the  law 
he  is  still  the  inventor,  even  though  the  mechanic 


YOUR  EMPLOYEE'S   INVENTIONS  197 

through  his  skill  is  able  to  improve  upon  his  employer's 
plan. 

In  a  decision  handed  down  many  years  ago  in  the 
Supreme  Court  of  the  United  States,  the  following  prin- 
ciple was  enunciated: 

"No  one  is  entitled  to  a  patent  for  that  which  he  did 
not  invent  unless  he  can  show  a  legal  title  thereto  from 
the  inventor  or  by  operation  of  law ;  but  where  a  person 
has  discovered  an  improved  principle  in  a  machine, 
manufacture,  or  composition  of  matter,  and  employs 
other  persons  to  assist  him  in  carrying  out  that  prin- 
ciple, and  they,  in  the  course  of  the  experiments  arising 
from  that  employment  make  valuable  discoveries 
auxiliary  to  the  plan  and  preconceived  design  of  the 
employer,  such  suggested  improvements  are  in  general 
to  be  regarded  as  the  property  of  the  party  who  dis- 
covered the  original  improved  principle,  and  may  be 
embodied  in  his  patent  as  part  of  his  invention."  (Aga- 
wam  Company  vs.  Jordan,  7  "Wall.,  583,  603.) 

The  principle  has  been  upheld  many  times.  Bernard, 
in  one  case  that  reached  the  courts,  was  a  salesman  with 
a  company  that  made  a  business  of  jobbing  novelties. 
Among  other  products,  the  company  sold  a  soap  and 
sponge  holder.  This  device  had  been  patented  by  a 
mechanic  named  Huebel,  who  was  a  partner  in  a  small 
manufacturing  firm. 

T  IMPROVING  on  an  invention  does  not  usually  con- 
*•  stitute  a  legal  claim  for  a  patent.  Plans  for  stimu- 
lating the  worker  with  an  inventive  turn  of  mind. 

Bernard,  in  discussing  the  article  with  a  customer, 
discovered  certain  objections  to  it.  He  conceived  the 
idea  of  a  new  device  which  would  overcome  these  objec- 
tions, and  went  to  Huebel  to  explain  his  idea  and  have 


198 HELPING   LOYALTY   HELP   YOU 

the  details  perfected.  He  gave  him  a  rough  sketch  of 
what  he  had  in  mind,  but  did  not  describe  his  proposed 
construction  in  detail.  Huebel  went  ahead  and  made 
the  new  soap  and  sponge  holder,  and  claimed  the  patent. 

But  when  suit  was  brought,  the  judge  held  that  the 
patent  belonged  to  Bernard,  notwithstanding  the  fact 
that  the  perfection  of  the  finished  article  was  partly 
due  to  the  skill  of  Huebel.  The  decision  stated  that  the 
mechanic  "must  invent  something,  not  merely  improve 
by  the  exercise  of  his  mechanical  skill  upon  a  concep- 
tion which  he  has  been  employed  to  work  out."  (Huebel 
vs.  Bernard,  C.  D.,  1900,  223;  90  0.  G.,  751.) 

It  will  be  apparent  on  reflection  that  these  distinctions 
between  the  man  who  conceives  and  the  one  who  exe- 
cutes are  based  upon  sound  principles  of  equity.  With- 
out these  distinctions,  no  one  but  a  skilled  mechanic 
could  be  an  inventor  in  many  lines. 

To  be  valid,  a  patent  must  be  issued  to  the  original, 
first  and  sole  inventor  of  the  improvement.  It  is,  there- 
fore, very  essential  that  the  application  should  be  filed 
in  the  name  of  the  person  who,  in  the  interpretation  of 
the  law,  is  in  fact  the  actual  inventor. 

Some  companies  take  out  all  patents  in  the  name  of 
some  executive,  regardless  of  who  originated  them.  This 
is  not  in  accordance  with  the  law,  and,  moreover,  it  is  a 
dangerous  practice.  If  it  can  be  shown  that  such  an 
executive  is  not  at  law  the  inventor,  the  patent  may  be 
invalidated.  The  real  inventor  could  make  a  second 
application  within  two  years  from  the  date  that  the 
invention  was  first  disclosed  to  the  public.  A  second 
patent  would  then  be  issued  and  the  courts  would  be 
compelled  to  declare  the  first  one  void. 

It  is  incorrect  to  assume  that  the  question  of  patent 
rights  is  settled  by  the  issuance  of  the  patent.  The 


YOUR  EMPLOYEE'S   INVENTIONS  199 

question  is  never  settled  so  long  as  there  are  adverse 
claimants.  This  may  or  may  not  be  a  defect  in  our 
patent  laws. 

Serious  injustice  has  sometimes  been  done  to  inventors 
through  the  suits  of  fraudulent  claimants.  On  the  other 
hand,  the  same  means  has  often  operated  to  protect 
inventors.  It  has  enabled  them  to  secure  justice  where 
their  ideas  have  been  stolen  and  patents  wrongfully 
issued  to  improper  claimants. 

The  form  of  contract  in  regard  to  inventions  which 
the  employer  enters  into  with  his  employees  should  pro- 
vide for  an  assignment  to  the  company  of  all  inventions 
he  makes  that  relate  to  the  business  of  the  company, 
irrespective  of  whether  or  not  the  inventions  are  made  in 
the  factory,  or  at  whose  expense  they  are  produced. 

The  Supreme  Court  of  the  United  States  has  held 
repeatedly  that  a  contract  is  absolutely  necessary  to 
enforce  a  patent  assignment.  A  government  employee 
invented  a  self-cancelling  revenue  stamp  and  patented 
it.  He  made  the  invention  on  the  government's  time 
and  with  its  materials  and  workmen.  The  court  held 
that  the  employee  was  entitled  to  the  patent,  but  that  the 
government  had  a  "shop-right"  to  make  and  use  the 
stamp. 

Every  invention  suggests  the  possibility  of  future 
litigation.  It  frequently  happens  that  the  same  improve- 
ment is  conceived  simultaneously  and  independently  by 
two  or  more  inventors.  It  may  then  become  necessary 
to  determine  who  was  in  fact  the  first  inventor.  To 
this  end,  as  much  documentary  evidence  as  possible 
should  be  accumulated  that  tends  to  fix  the  date  of 
the  invention. 

If  an  invention  is  suggested  to  the  employee  by  the 
employer,  a  sketch  can  be  made,  dated  and  signed  by 


gOO HELPING   LOYALTY   HELP   YOU 

the  employer  as  the  inventor.  "Witnessed  and  filed  away, 
it  can  be  used  in  case  of  future  contest. 

In  like  manner  the  employee  should  execute  a  sketch 
when  he  has  conceived  an  invention.  This  should  also 
be  signed,  dated  and  witnessed  and  filed  by  the  employer. 
As  the  work  of  development  proceeds,  additional 
sketches  may  be  made,  showing  the  progress  of  the 
invention  toward  reduction  to  practice. 

Many  factories  award  a  prize  each  month  for  the 
best  suggestions  made  by  employees.  This  is  an  excel- 
lent plan,  because  it  makes  the  employee  think  about 
his  work  and  take  an  interest  in  it. 

When  such  is  the  case,  inventions  often  occur  in  most 
unexpected  ways.  The  story  is  told  of  the  textile  design 
known  as  "water  tabbies,"  which  owed  its  origin  to 
accident,  or,  perhaps,  to  an  instantaneous  conception. 

A  workman,  having  spat  on  the  floor,  put  his  hot  iron 
upon  it,  and  observed  that  it  spread  into  a  kind  of 
flower.  He  afterwards  tried  the  experiment  upon  fabric 
and  found  it  produced  the  same  effect.  He  then  obtained 
a  patent,  and  lived  to  make  a  comfortable  fortune. 
(Robinson  on  Patents,  I,  p.  127.) 


IT  IS  the  elimination  and  utilization  of  toaste,  toasie  effort, 
waste  time  and  material,  the  minimizing  of  destruction 
and  damage,  wear  and  tear,  that  produce  the  great  results 
in  the  industrial  world.  There  is  no  magic  in  these  accom- 
plishments. The  leaders  in  action  or  thought  are  not  magi- 
cians but  steady,  persistent  workers." 

THEO.  N.  VAIL, 

President  of  the  American  Telephone  and  Telegraph  Company 


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